Taxation Law - Appeals To The Federal Court

By: Frank Egan - LAC Lawyers
Appeals to the Federal Court require a written application which sets out brief details of the objection decision and must be filed with the relevant Federal Court Registry.

The application must also be accompanied by the prescribed fee applicable to all applications to the Federal Court. This is currently $606.00 for individuals and $1,453.00 for corporations for each objection decision.

The taxpayer must also serve a sealed copy of the application on the Commissioner, as Respondent, at the Office of the Australian Government Solicitor in the state or territory in which the application was filed.

Within 28 days of serving a sealed copy of the application on the Commissioner, the Australian Taxation Office will provide the taxpayer with a Notice of Appearance, a copy of the documents filed with the Federal Court, and a statement of the facts, issues and contentions regarded by the Commissioner as relevant to the appeal.

The Federal Court will then call a Directions Hearing which must be called at least five weeks after the taxpayer’s application was filed.

Once the Federal Court is satisfied that the Commissioner has provided all relevant documents, appeals are then set down for hearing. The taxpayer must pay a setting down fee of $1,211.00 for individuals and $2,422.00 for corporations when a date is fixed for the hearing of the appeal. There is also a daily hearing fee of $483.00 for individuals and $969.00 for corporations.

The Federal Court is able to overturn a decision of the Commissioner of Taxation. However, the Federal Court cannot interfere with any discretion exercised by the Commissioner. It can only refer the matter back to the Commissioner for further assessment.

The Federal Court is able to award costs either against the Commissioner of Taxation if the taxpayer is successful, or against the taxpayer if the Commissioner is successful. In either case, the proportion of costs awarded will generally be between 50% and 60% of the actual costs incurred by the successful party. However, if the Federal Court were to conclude that the behaviour of either the taxpayer or the Commissioner warranted sanction because of the way in which the case had been brought or conducted, a higher proportion of costs (known as solicitor/client costs) may be awarded.

A taxpayer should seek legal advice as to the choice of whether to seek review in the AAT or appeal in the Federal Court may involve taxpayers seeking legal advice. Whilst the Federal Court is the more appropriate forum for objections which are highly technical or which involve complex propositions of taxation law, the court costs are high. Taxpayers generally retain barristers and solicitors to conduct their appeals. The AAT, on the other hand, is cheaper to commence and pursue reviews and places an emphasis upon consensual resolution of disputes. However, AAT members may be less experienced than Federal Court judges in hearing highly complex disputes which involve difficult propositions of taxation law or in managing pre-trial processes to ensure a speedy hearing.

Taxpayers do have further appeals both from the AAT or from the Federal Court.

Whether disputing Private Rulings or taxation assessments, taxpayers maximise their chance of success by utilizing the services of lawyers who are familiar with taxation law and the arguing of objections.

Finally, taxpayers should remember that the Australian Taxation Office will impose a General Interest Charge (GIC) which is currently 13.19% on all outstanding taxation assessments from the date that the assessment was made. The lodging of a review at the AAT or appeal to the Federal Court does not stop this GIC from accumulating. Taxpayers should seek legal advice as to whether to pay either the whole or a part of the disputed taxation notwithstanding commencing the review or appeal. While this will have financial consequences on the taxpayer, the payment will prevent further GIC from accruing. The cost of funding the payment will be less than the GIC. If the taxpayer is successful in the review or appeal, and the amount of the assessment has already been paid, the Commissioner of Taxation is not obliged to refund interest on the refunded taxation payments.

Article Source: http://www.articleblender.com


Frank Egan is the Chief Executive Officer of LAC Lawyers Sydney and has over 27 years of experience as a lawyer.

Taxation Law - Changes To Private Rulings

By: Frank Egan - LAC Lawyers
The Commissioner of Taxation does have the power to change a Private Ruling in four situations as follows:

1 Where the taxpayer gives consent to the Ruling being changed;

2 Without the taxpayer’s consent, if the Private Ruling is about an arrangement which has not yet been carried out. This means that if the Private Ruling covered an arrangement which the taxpayer repeatedly carried out over time (for example buying and selling a particular item), the Private Ruling could be changed for any of the arrangements which occurred after the date of the change;

3 Without the taxpayer’s consent where the arrangement had commenced. This is limited, however, to those circumstances where the Private Ruling was causing another taxpayer to be disadvantaged and his or her disadvantage was greater than the disadvantage that the Rulee would suffer if the Ruling were to be changed; and

4 By issuing a Public Ruling which is inconsistent with the Private Ruling. However, this could only occur if the taxpayer’s arrangement has not begun to be carried out or if it has commenced and another taxpayer would be disadvantaged to a much greater extent than the Rulee.

If the taxpayer received the Private Ruling before he or she lodged the return for the year in which the arrangement took place, and then the taxpayer did not follow that Ruling, then the taxpayer may be liable for the extra tax that he or she would have paid under the Ruling. If the taxpayer had received the Private Ruling after he or she lodged the relevant return, then the Commissioner has the power to amend the assessment to take the Private Ruling into account. This may decrease the taxation liability but may also increase that liability.

The way in which a taxpayer can have a Private Ruling reviewed is determined by whether or not an assessment in respect of an income tax return has issued which deals with the arrangement covered by the Private Ruling.

If the assessment has already issued, then the taxpayer should have the assessment reviewed. If no assessment is issued, then the taxpayer should have the Ruling reviewed.

To have an assessment reviewed, the taxpayer needs to lodge an objection. That objection must be in writing in which the taxpayer informs the Commissioner which assessment is to be reviewed and provides details of the years and the relevant tax file number. The objection must also state which matter dealt with within the assessment is disputed and why the taxpayer believes that the assessment should be amended. For most short period of return taxpayers, the objection must be lodged within two years of the date upon which the taxpayer received the original assessment. There are no fees for lodging objections.

To have a Private Ruling reviewed, the taxpayer must also need to lodge an objection. Again, the objection must be in writing. The taxpayer must provide the Authorisation number of the Private Ruling. The taxpayer must also inform the Commissioner which part of the Private Ruling is disputed and why the taxpayer believes the Ruling should be changed.

This objection to the Ruling must be lodged within 60 days of the date of service of the Private Ruling upon the taxpayer or, for short period of return taxpayers, within two years of the last day allowed for lodging the tax return for the particular year that the Private Ruling is about, whichever is the latest. Again, there are no fees for lodging objections to Private Rulings.

Article Source: http://www.articleblender.com


Frank Egan is the Chief Executive Officer of LAC Taxation Lawyers and has over 27 years of experience as a lawyer.

The Law Of Sowing And Reaping

Many people have heard the statement, "You reap what you sow." Or, as my wife learned when she was making drapes for a living, "You rip what you sew." When it comes to sowing and reaping we often fail to enjoy the blessings that God has for us because we don't fully understand this law. Some people refer to it under different names, but some also recognize that this is the law of laws. Understanding how this works can help us create the kind of life we desire.

Galatians 6:7-10 says, "Do not be deceived, God is not mocked; for whatever a man sows, that he will also reap. For he who sows to his flesh will of the flesh reap corruption, but he who sows to the Spirit will of the Spirit reap everlasting life. And let us not grow weary while doing good, for in due season we shall reap if we do not lose heart. Therefore, as we have opportunity, let us do good to all, especially to those who are of the household of faith."

The first thing is that Paul; the writer of Galatians, does is to clearly tell us to stop being deceived. We need to avoid the mistake of believing that the circumstances and conditions we see in our lives are all external to us, that we are just victims and "god" is picking on us.

In the NIV, Proverbs 19:3 says, "A man's own folly ruins his life, yet his heart rages against the LORD." And Paul is simply restating this fact. Many people ruin their lives by their own actions, their thoughts, words, and actions, and then get angry with God.

When we recognize that the circumstances and conditions of our lives are the result of our own sowing, we will finally be able to take authority over them. As long as we remain deceived, and continue to blame God instead of taking responsibility for our lives, we remain powerless to change things.

We are sowing seeds with every thought, word, and action we take. Most of the time we are completely unaware of what we are sowing, and we end up with a lot of weeds in our field (our lives) rather than good seeds. But we can change that by becoming aware of what we are thinking, saying, and doing. Once we start listening to, and observing, how we think and act we can start to take steps to change first our thoughts, then our words. When we combine that with changing what we do, we will begin to reap a better harvest.

Many people struggle with having too much month left at the end of their money. No matter how hard they work, there never seems to be enough. They think about all that they can't afford, they constantly talk about how little they have, and the focus of their spending is on the bare necessities. In order for them to have more money they need to change the seeds they are sowing. And that doesn't mean that they have to give away all their cash.

Jesus said, "Give, and it will be given to you. A good measure, pressed down, shaken together and running over, will be poured into your lap. For with the measure you use, it will be measured to you." (Luke 6:38) As we start to sow in faith, we begin to think about and be thankful for the abundance that we already have, no matter how small it may seem. And we need to start giving to others. If we don't have enough money, we can start sowing by finding ways to give of our time.

And when it comes to our income, we should have the goal of paying a tithe to our church. If that's too much right now, we can start with some smaller amount that we regularly give. Paying a tithe isn't about obeying a commandment out of the Old Testament; it's about making a statement to God and ourselves that we trust Him to take care of us financially. It's really a declaration that we believe in God's abundance.

As we get going with this whole process we need to be careful that we don't lose heart and grow weary. Because we are sowing seeds, and not popping coins in a vending machine, it will take some time before we see the results. But Paul reminds us that we will reap, as long as we don't give up.

Article Source: http://www.articleblender.com


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