Hart v Commissioner of Taxation [2003] FCAFC 105

FEDERAL COURT OF AUSTRALIA

Hart v Commissioner of Taxation [2003] FCAFC 105 TAXATION – income tax – deductions – deductibility of expenses connected with airshow activities – whether carrying on a business in respect of those activities – where large expenses and minimal income over a long period – penalties – whether reckless for tax agent to claim expenses on basis that a business was being carried on – whether earlier audit which did not challenge the claim of carrying on a business relevant and material to a finding of recklessness

Taxation Administration Act 1953 (Cth) s 14ZZ Income Tax Assessment Act 1936 (Cth) ss 226G, 226H, 226J, 226K, s 51 Taxation Laws Amendment (Self Assessment) Bill 1992 Ronpibon Tin NL v Federal Commissioner of Taxation (1949) 78 CLR 47 cited Western Australia v Ward (2002) 76 ALJR 1098 cited Fox v Percy [2003] HCA 22 cited Warren v Coombes (1979) 14 CLR 531 approved Browne v Dunn (1894) 6 R 67 cited Flower & Hart (a firm) v White Industries (Qld) Pty Ltd (1997) 87 FCR 134 affirmed Richard Walter Pty Ltd v FCT (1996) 67 FCR 243 referred to BRK (Bris) Pty Ltd v Commissioner of Taxation (1999) 99 ATC 4725 referred to BRK (Bris) Pty Ltd v Commissioner of Taxation (2001) ATC 4111 cited LAURA HART v THE FEDERAL COMMISSIONER OF TAXATION No Q 199 of 2002 SPENDER, HILL, HELY J BRISBANE 1 AUGUST 2003

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY Q 199 OF 2002

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN: LAURA HART

APPELLANT

AND: THE FEDERAL COMMISSIONER OF TAXATION

RESPONDENT

JUDGES: SPENDER, HILL, HELY JJ

DATE OF ORDER: 1 AUGUST 2003

WHERE MADE: BRISBANE

THE COURT ORDERS THAT: 1. The appeal be dismissed. 2. The appellant pay the respondent's costs of the appeal. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.