Annotated TAA (for GST cases)

Part IIB – Running Balance Accounts, Application of payments and credits, and related matters

Division 3A – Refunds of RBA surpluses and credits

8AAZLF     Commissioner must refund RBA surpluses and credits

8AAZLG     Retaining refunds until information or notification is given

8AAZLGA   Retaining refunds while Commissioner verifies information

Cases

Sanctuary Australasia Pty Ltd and Commissioner of Taxation [2013] AATA 371 – the applicant was not entitled to object to the retaining of a refund under s 8AALGA where the Commissioner had subsequently issued a “nil” assessment – the applicant was required to object to this assessment (Case analysis)

International cases

Contract Pacific Ltd v CIR [2010] NZSC 136 – GST refunds, obligation of Commissioner to pay refunds pending investigation – first instance – [2008] NZHC 1733

Almond Properties v The Commissioner of Inland Revenue [2003] NZCA 221 – GST refunds, delay in payment by Commissioner pending investigation

8AAZLH     How refunds are made

Division 4 – Miscellaneous provisions about tax debts

8AAZN       Overpayments made by the Commissioner under taxation laws

Cases

Swanbat Pty Ltd and Commissioner of Taxation [2013] AATA 891 – at [101]: the payment of a refund in respect of a tax period in respect of which the 4 year limitation period in s 105-55 of Schedule 1 has expired “may well be a mistake and within the meaning of an ‘administrative overpayment’, as defined in s 8AAZN(3) of the TAA”; at [105]: an administrative overpayment under s 8AAZN does not necessarily form part of an ‘assessment’ for the purposes of the GST Act and an administrative overpayment cannot properly be applied as GST when calculating the taxpayer’s net amount and it cannot be properly included in an assessment – the correct approach would be to issue a notice, as provided for by s 8AAZN(2) – Case analysis

Part IVC – Taxation objections, reviews and appeal

Division 3 – Taxation objections

14ZU     How taxation objections are to be made

14ZV     Limited objection rights in the case of certain amended taxation decisions

14ZVA   Limited objection rights because of objection against private ruling

14ZW    When taxation objections are to be made

14ZX     Commissioner to consider applications for extension of time

14ZY     Commissioner to decide taxation objections

14ZYA   Person may require Commissioner to make an objection decision

14ZYB   Requiring Commissioner to make a private ruling

14ZZ     Person may seek review of, or appeal against, Commissioner’s decision

Cases

Van Gestel and Commissioner of Taxation [2014] AATA 396 – a taxpayer who claimed to be the victim of “identity theft” where input tax credits were claimed on the taxpayer’s BAS was “dissatisfied” with the objection decision of the Commissioner and could seek review to the Tribunal

Division 4 – AAT review of objection decisions and extension of time refusal decisions

14ZZK   Grounds of objection and burden of proof

14ZZL    Implementation of Tribunal decisions

14ZZM   Pending review not to affect implementation of taxation decisions

Division 5 – Court appeals against objection decisions

14ZZO   Grounds of objection and burden of proof

Cases

McDonald’s Australia Ltd v Commr of Taxation [2008] FCA 37 – at [13]: an application for summary judgment by the applicant (which bears the onus of proof) can properly be described as ambitious, particularly where the proceeding is at an early stage, no evidence has been filed, there has been no discovery, no subpoenas have been issued and there are no formal pleadings. It must also be borne in mind that the Commissioner has no first hand knowledge of the underlying facts and circumstances – at [14]-[15]: the Commissioner’s appeal statement might provide a proper basis for summary judgment notwithstanding the burden of proof lying on the taxpayer

14ZZP   Order of court on objection decision

14ZZQ   Implementation of court order in respect of objection decision

14ZZR   Pending appeal not to affect implementation of taxation decisions

SCHEDULE 1 – COLLECTION AND RECOVERY

CHAPTER 3 – Collection, recovery and administration of other taxes

Part 3-10 – Indirect taxes

Division 105 – General rules for indirect taxes

Subdivision 105A – Assessments

105-3     Application of Subdivision (prior to 1 July 2012)

105-5     Commissioner may make assessment of indirect tax

105-10   Request for assessment

105-15   Indirect tax liabilities do not depend on assessment

105-20   Commissioner must give notice of assessment

105-25   Amendment of assessment

Cases

McDonald’s Australia Ltd v Commr of Taxation [2008] FCA 37 – at [8]-[11]: the issue of an amended assessment does not invalidate an assessment issued under s 105-5 but becomes the operative assessment

105-30   Later assessment prevails in case of inconsistency

Subdivision 105B – Review of indirect tax decisions

105-40   Reviewable indirect tax decisions

Subdivision 105C – Limits on credits, refunds and recovering amounts

105-50   Time limit on recovery by the Commissioner

Cases

Re Tomker Pty Ltd (in Liquidation[2016] VSC 656 – the expiration of the four year limitation period in s 105-50 of Schedule 1 to the TAA went to the substance of the tax liability rather than just to its recoverability. Accordingly, if the four year period had expired, the tax amount was not ‘payable’ and it could be plausibly argued that there was no debt at all.

The Hotel Apartment Purchaser and Commissioner of Taxation [2013] AATA 567 – the taxpayer’s net amount became payable 28 days after the end of the tax period and the time for the Commissioner to issue a notification expired 4 years from that date, not from the date of the end of the tax period – (Case analysis)

Brookdale Investments Pty Ltd and Commissioner of Taxation [2013] AATA 154 –  at [80]: a notice under s 105-50 need not identify the amount which the Commissioner says is owing – s 105-50 does not stipulate that any particular formality is required by a notice under the section, provided the notice brings to the taxpayers attention that the Commissioner claims an entitlement to an unpaid net amount – (Case analysis)

Cyonara Snowfox Pty Ltd v Commissioner of Taxation [2012] FCAFC 177 – a notice of assessment is a notification for the purposes of s 105-50(3)(a) notwithstanding that the amount stated in the assessment is accepted by the Commissioner to be incorrect because the taxpayer was entitled to an amount of input tax credits – tribunal [2010] AATA 137 and [2011] AATA 124

Wynnum Holdings No 1 Pty Ltd and Commissioner of Taxation [2011] AATA 296 – s 105-50 does not operate to prevent the ability of the Commissioner to recover overpaid refunds of input tax credits – at [35]: an amount of “indirect tax” does not include amounts claimed as input tax credits because they are not the “tax that is payable under the GST law and imposed as goods and services tax”

Russell v Commissioner of Taxation [2009] FCA 1224 – at [255]: s 105-50 only applies where a net amount is payable to the Commissioner – the section does not apply where the only controversy is about an entitlement to an input tax credit

105-55   Time limit on refunds etc from the Commissioner

Cases

North Sydney Developments Pty Ltd and Commissioner of Taxation [2014] AATA 363 – letter given to Commissioner was a valid notification for the purposes of s 105-55(1)(a) of Schedule 1 to the TAA in relation to input tax credits – at [13]: a communication relied on as a notification for the purposes of TAA Schedule 1 s 105-55(1)(a) does not have to specify an input tax credit amount; at [31]: a notification requires no greater specification than the tax period involved, and the nature of the refund or input tax credit claimed

Swanbat Pty Ltd and Commissioner of Taxation [2013] AATA 891 – at [34]: a taxpayer’s entitlement to a refund for a tax period prior 1 July 2008 is subject to the operation of s 105-55 as amended from 1 July 2008; at [43] the self-assessment regime that came into effect on 1 July 2012 does not interrupt the scope of time limits in s 105-50 or 105-55 in respect of tax periods prior to 1 July 2012 – therefore, lodging a revised BAS for the June 2008 quarter more than 4 years after 30 June 2008 does not stop or reset the clock in respect of the 4 year entitlement to a refund; at [46]: s 105-55 has substantive operation and there is no discretion to extent the 4 year period; [at 56]: an application for a private ruling may be sufficient to serve as notice of an entitlement to a refund for the purposes of s 105-55 – Case analysis

Tom and Commissioner of Taxation [2013] AATA 28 – lodgment of revised activity statements after expiry of 4 year period did not constitute a valid notification for the purposes of s 105-55

Dandenong Motors Unit Trust and Commissioner of Taxation [2012] AATA 920 – s 105-55 (pre-amendment) operated to extinguish the entitlement of a taxpayer to a refund of overpaid GST to the extent that the taxpayer reported a negative net amount

MTAA Superannuation Fund (RG Casey Building) Property Pty Ltd and Commissioner of Taxation [2011] AATA 769 – document lodged by the applicant was a valid notification for the purposes of s 105-55

National Jet Systems Pty Ltd and Commissioner of Taxation [2011] AATA 766 – document lodged by the applicant was a valid notification for the purposes of s 105-55

Central Equity Limited v Commissioner of Taxation [2011] FCA 908 – document lodged by the applicant was a valid notification for the purposes of s 105-55 as a notification of “the refund, other payment or credit” – at [77] the specificity sought by the Commissioner in the notification was unnecessary

Clontarf Developments Pty Ltd and Commissioner of Taxation [2010] AATA 1065 – applicant not entitled to refund of input tax credits where claim made outside 4 year time period

Australian Leisure Marine Pty Ltd and Commissioner of Taxation [2010] AATA 620 – applicant not entitled to refund of input tax credits where claim made outside 4 year time period – at [17]: s 105-55 has substantive effect in that the expiry of the four year time limit extinguishes the right of a taxpayer to notify the Commissioner of an entitlement to the input tax credit. As such the provision denies the entitlement of an entity to an input tax credit – at [18]: the Commissioner (and the Tribunal) has no discretion to extend the time limit in s 105-55.

Rulings and Determinations

MT 2009/1 – Austlii – Miscellaneous taxes: notification requirements for an entity under section 105-55 of Schedule 1 to the Taxation Administration Act 1953

105-65   Restrictions on refunds

Cases

Naidoo and Commissioner of Taxation [2013] AATA 443 – s 105-65 is not a necessary step in establishing a taxpayer’s liability in respect of refunds, but is a procedural provision – the section can only operate after the net amount has been established – the Tribunal did not have jurisdiction under s 14ZZ to review a decision made by the Commissioner with respect to s 105-65 as that finding did not alter the taxpayers net amount – (Case analysis)

The Private Tutor and Commissioner of Taxation [2013] AATA 136 – at [19]: the section does not give the Commissioner authority to recover an amount from a taxpayer by assessing a net amount pursuant to s 17-15 which he knows to be incorrect – (Case analysis)

International All Sports v Commissioner of Taxation [2011] FCA 824 – the provision does not extend to amounts overpaid by reason of a mistaken application of the formula in s 126-10(1) dealing with gambling supplies – overpayments not made in relation to taxable supplies

KAP Motors Pty Ltd v Commissioner of Taxation [2008] FCA 159 – the provision does not extend to a transaction which does not constitute a supply

International Cases – Courts

Marks and Spencer plc v Customs and Excise [2009] UKHL 8; [2009] STC 452; [2009] 1 All ER 939 – food, whether teacakes were biscuits, claim for refund of VAT, limitation of refunds where claimant unjustly enriched, effect of passing on VAT to customers, retrospective legislation, effect of community law – judgment of House of Lords referring to ECJ – [2005] UKHL 53 – request for preliminary ruling by ECJ – [2006] UKHL 69 – judgment of European Court of Justice – [2008] EUECJ C-309/06; [2008] STC 1408

Fleming v Her Majesty’s Revenue and Customs [2008] UKHL 2 – refunds of VAT, effectiveness of legislation to limit refund claims

Rulings and Determinations

MT 2010/1 – Austlii – Miscellaneous tax: restrictions on GST refunds under section 105-65 of Schedule 1 to the Taxation Administration Act 1953

Subdivision 110F – review of GST decision

110-50   Reviewable GST decisions

CHAPTER 4 – Generic assessment, collection and recovery rules

Part 4-1 Returns and Assessments

Division 155 – Assessments

155-5     Commissioner may make assessments

155-10   Commissioner must give notice of assessment

155-15   Self-assessment

155-20   Assessment of indirect tax on importations and customs dealing

155-25   Special assessment

155-30   Delays in making assessments

Division 444 – Obligations of entities on behalf of other entities

444-30   Partnerships

Cases

Yacoub v Commissioner of Taxation [2012] FCA 678 – enterprise found to be a partnership (and not a 50/50 joint venture) – the applicant was therefore jointly and severally liable for all the unpaid GST (case analysis)

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