Feb 072016
 

On 6 January 2016 the ATO issued a Decision Impact Statement concerning the High Court judgment in the Australian Building Systems case.

[See my previous post for a discussion of the High Court’s majority decision: Australian Building Systems case: plenty of common sense in the dissenting judgment by Justice Michelle Gordon]

It seems that although the ATO accepts the High Court’s majority decision (as, of course, it must), it’s interpretation of the decision is nuanced, and suggests that it has no intention of giving up on the retention obligation.

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Australian Building Systems case: plenty of common sense in the dissenting judgment by Justice Michelle Gordon

 Capital Gains Tax, Corporate Insolvency, court decisions, Insolvency Law, Priority Debts, Tax debts, Taxation Issues  Comments Off on Australian Building Systems case: plenty of common sense in the dissenting judgment by Justice Michelle Gordon
Dec 172015
 

(Judgment of December 2015)

By a majority of three to two the High Court dismissed the Australian Taxation Office’s appeal in the Australian Building Systems case: Commissioner of Taxation v Australian Building Systems Pty Ltd (In Liquidation); Commissioner of Taxation v Muller and Dunn as Liquidators of Australian Building Systems Pty Ltd (In Liquidation) [2015] HCA 48 (10 December 2015) .

This test case – run by the Australian Restructuring Insolvency & Turnaround Association (ARITA) and the Australian Taxation Office (ATO) – began in 2013 and has previously been before the Federal Court and the Federal Court of Appeal. It was supposed to settle a far-reaching, long-standing argument that ARITA and the ATO had been having since 2009.

Argument about when obligation arises

The primary argument in this case – framed here as an issue for liquidators in general – has been whether the “retention obligation” placed on liquidators by section 254(1)(d) of the Income Tax Assessment Act 1936 arises prior to the issue of a tax assessment or only after the issue of an assessment.
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