In a decision handed down on Tue 4.6.2013, the AAT has held that a taxpayer was not a “person … dissatisfied” with the Commissioner’s reviewable objection decision and relating to the withholding of a GST refund, and as a consequence, was not entitled to apply to the Tribunal for review of that decision.
The taxpayer conducts a business supplying and installing solar panels. When it lodged its quarterly BAS on 27 July 2011, it disclosed a GST debt of id=”mce_marker”6,045 relating to the tax period 1 April 2011 to 30 June 2011 and, when it lodged a revised BAS on 29 August 2012, it claimed a negative net amount (and so a GST refund) of $35,312 for the same period. The claims related to input tax credits relating to the sales and returns of solar panels. The Commissioner audited the taxpayer and on 4 September 2012, decided to withhold the GST refund of $35,312 while he undertook the audit. The taxpayer lodged an objection which was disallowed.
On 6 May 2013, the taxpayer lodged an application for review of that objection decision. Had events had ended there, the Tribunal said it would have been satisfied the taxpayer was entitled to make its application for review and that the Tribunal had power to review the Commissioner’s decision.
However, that did not happen and before the taxpayer lodged its application for review, the Commissioner had, on 26 April 2013, issued an amended assessment of the net amount for the tax period 1 April 2011 to 30 June 2011. In that assessment, he amended the net amount from a GST refund of $35,312.00 to nil. On 19 May 2013, the taxpayer set out grounds of objection to the amended assessment and asked the Commissioner to consider it a notice of objection to his decision to issue it.
The Tribunal decided that, as soon as the Commissioner issued the amended assessment, the taxpayer was no longer a “person … dissatisfied” with the Commissioner’s objection decision relating to the retention of the refund amount. Consequently, the AAT held it was not entitled to apply for review of what is a reviewable objection decision under s 14ZZ(a)(i) of the TAA.
(AAT Case [2013] AATA 371, Re Sanctuary Australasia Pty Ltd and FCT, AAT, Forgie DP, AAT Ref: 2013/2071, 4 June 2013.)
[LTN 106, 4/6/13]
[FJM Note: What this summary fails to make clear is that the Commissioner used the power he has had since 27 June 2012, to withhold GST refunds temporarily, whilst he investigates the circumstances and possibly issues a further assessment or amends an assessment (under s8AAZLGA of the Taxation Administration Act 1953 (‘TAA’) which was inserted by Tax Superannuation Laws Amendment (2012 Measures No.1) 2012, following the Multiflex case). Further, the decision first referred to the AAT, which it said it could have adjudicated on, was against this temporary withholding of the GST refund, where the AAT’s power to consider this action came from the authority given by s8AAZLGA(6) to object in the manner specified in Part IVC of the TAA. This case looks at the scheme of s8AAZLGA, which is only to temporarily withhold GST refunds until satisfied that it is properly refundable or an assessment is issued (which can be the subject of a separate objection under s105-40 of the TAA Schedule 1). It was in this context that the AAT concluded that there was nothing left to object against, once the temporary withholding of a refund had run its course by the issuing of zero assessments.]