The Federal Court has continued freezing orders against five foreign corporations which had never filed tax returns in Australia and which had been assessed to tax for an aggregate exceeding $30 million (DFCT v Hua Wang Bank Berhad ([2010] FCA 1014). Kenny J was satisfied that it was in the interests of justice to continue [...]
The Federal Court has allowed the Commissioner’s appeal against a decision of the AAT and held that the taxpayer had failed to discharge the onus of proving that penalty tax for recklessness should not be imposed (FC of T v White (No 2) [2010] FCA 942). The Commissioner had assessed the taxpayer to penalty tax [...]
The Federal Court has held that interest incurred by a taxpayer on intra-group borrowings as part of a scheme to eliminate a dividend trap in the group was not an allowable deduction for the 1991, 1993 and 1994 income years (IEL Finance Ltd v FCT [2010] FCA 898). The same result was reached by a [...]
In a joint judgment handed down on 30 March 2010 the High Court (French CJ, Gummow, Hayne, Heydon and Crennan JJ) dismissed both the Commissioner’s and the taxpayers’ appeals from the decision of the Full Federal Court in the Bamford case (FCT v Bamford [2010] HCA10). The High Court’s decision has given some certainty in [...]
The Federal Court (Sundberg J) has held that a partnership cannot be a connected entity under the former CGT small business relief connected entity rules (White v FCT [2009] FCA 880). This meant that partnerships in which the taxpayer was a partner could not be connected with the taxpayer and that the net values of [...]
The Federal Court (McKerracher J) has dismissed an appeal by the Commissioner from a decision of the AAT in which it was held that the taxpayer company’s activities in collecting valuable artwork and antiques was an enterprise for the purposes of GST (FCT v Swansea Services Pty Ltd [2009] FCA 402. Over several years the [...]
The Full Federal Court has held that a loss company was carrying on the same business before and after a disqualifying change in the beneficial ownership of its shares and was, therefore, entitled to a deduction for its losses (Lilyvale Hotel Pty Ltd v FCT [2009] FCAFC 21). The decision in this case reverses a [...]
Reversing the decision of Gordon J at first instance, the Full Federal Court has held that, having regard to all relevant facts, a prepayment of “rent” was an expenditure of capital or of a capital nature and, accordingly, was not deductible as a general deduction (FCT v Star City Pty Ltd [2009] FCAFC 19). The [...]
Pagone J (Victorian Supreme Court) has held that the Commissioner could not rely on sec 109 of the Constitution to require production of documents pursuant to a sec 264 ITAA 1936 notice where the documents attract public interest immunity (Law Institute of Victoria Ltd v DFCT [2009] VSC 55). A Deputy Commissioner of Taxation gave [...]
A single Judge of the Federal Court (Lindgren J) has held that the so-called capital gains tax, which was enacted as Part IIIA ITAA 1936, was within the taxes covered by the Netherlands and the former UK double tax agreements, both of which were entered into before the enactment of Part IIIA ITAA 1936 (Undershaft [...]
The Federal Court (Stone J) has considered the characterisation of a number of categories of supply made in connection with individual lots in a strata plan used, together, as rooms in a hotel (South Steyne Hotel Pty Ltd v FCT [2009] FCA 13). South Steyne Hotel Pty Ltd (“South Steyne”), which owned the Sebel [...]
The Federal Court (Graham J) has held that salaries paid by the applicant company (a wholly owned subsidiary of Cathay Pacific Airways Ltd) to aircrew who were residents of Australia, who were obliged to serve the applicant by operating Cathay Pacific Aircraft in any part of the world and on any routes, who had their [...]
The Full Federal Court (Finn, Dowsett and Edmonds JJ) has unanimously allowed appeals against a private ruling issued by the Commissioner in which he ruled that a taxpayer who participated in a managed investment scheme, which was being set up to produce almonds, would not be carrying on a business and would not be entitled [...]
The Full Federal Court (Ryan, Edmonds and Gordon JJ) has unanimously held that compensatory damages received by the taxpayer company for defamation and which were calculated solely by reference to lost profits attributable to the defamatory publications were not assessable as ordinary income (FCT v Sydney Refractive Surgery Centre Pty Ltd [2008] FCAFC 190). The [...]
It may be noted that there is a CGT exemption for compensation or damages “you” receive for any wrong or injury “you” suffer in “your” occupation (sec 118-37(1)(a) ITAA 1997). There seems no reason why “you” would not include a company in this context or that the word “occupation” would cover a business carried on [...]
The Federal Court (Middleton J) has held that a professional valuer made a number of vitiating errors in making a 1 July 2000 GST margin scheme valuation under the hypothetical development method of valuation prescribed by the margin scheme valuation requirements determination (“the Determination”) for valuing partly completed buildings (Brady King Pty Ltd v FCT [...]
The Federal Court (Middleton J) has held that, although a capital contribution made by the taxpayer to a company increased the valued of the taxpayer’s shares in the company, it was not reflected in the state or nature of the shares at the time of their disposal by the taxpayer and, accordingly, did not form [...]
The Full Federal Court has unanimously dismissed an appeal by the taxpayer which concerns the interaction of the consolidation regime with the imputation system in relation to the transfer of franking credits upon acquisition of one consolidated tax group by another (Hastie Group Ltd v FCT [2008] FCAFC 187).
In what appears to be a test case, the Federal Court (Logan J) has held that a liquidator of a corporation is not personally liable for GST in respect of the sale of new residential premises owned by the corporation pursuant to a contract for the sale of the premises entered into and completed after [...]
The chief operating company of a GST group was a life insurance company (NMLA) which invested in units of unit trusts associated with (but not part of) the group and whose investments overseas were accepted as being GST-free. The issue for decision was the extent input tax credits were allowable in respect of general management [...]
The High Court by a 4:1 majority has affirmed the decision of the Full Federal Court that a company limited by a guarantee which carried on businesses and distributed its funds to support Christian activities (Bible translation and missionary work) carried out by another entity (which was endorsed as an income tax exempt charity) was [...]
The Full Federal Court has held that a garnishee notice issued under sec 260-5 of Sch 1 of the Taxation Administration Act to a firm of solicitors in respect of moneys held on behalf of a trust of which the corporate trustee had already gone into liquidation was not an “attachment” for the purposes of [...]
The Federal Court (Kenny J) has held that, in working out the tax cost setting amount under the consolidation rules where a subsidiary leaves a consolidated group, liabilities of the leaving entity “at the leaving time” are determined by reference to liabilities “just before” the leaving entity ceases to be a subsidiary member (Handbury Holdings [...]
The Federal Court (Middleton J) has upheld an appeal from a decision of the AAT refusing the re-registration of the appellant as a tax agent (Toohey v Tax Agents’ Board of Victoria (No 2) [2008] FCA 1796). The AAT did not correctly approach the ultimate issue of determining whether the appellant was a fit and [...]
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29 Sep 2010
Amending Bills reintroduced
Several amending Bills, including the Tax Laws Amendment (2010 Measures No 4) Bill 2010, were reintroduced into Federal ..
15 Sep 2010
Freezing orders continued
The Federal Court has continued freezing orders against five foreign corporations which had never filed tax returns in A..
31 Aug 2010
Penalty for recklessness
The Federal Court has allowed the Commissioner's appeal against a decision of the AAT and held that the taxpayer had fai.. |