Commissioner of Taxation v Healius Ltd [2020] FCAFC 173

Federal Court of Australia

Commissioner of Taxation v Healius Ltd [2020] FCAFC 173 Appeal from: Healius Ltd v Commissioner of Taxation [2019] FCA 2011

File numbers: NSD 36 of 2020 NSD 37 of 2020 NSD 38 of 2020 NSD 39 of 2020 NSD 40 of 2020

Judgment of: JAGOT, MOSHINSKY AND COLVIN JJ

Date of judgment: 9 October 2020

Catchwords: TAXATION – appeals from decision dismissing appellant's applications to appeal from objection decisions by Commissioner of Taxation – where lump sum amounts paid to medical practitioners under arrangements to conduct practice from respondent's medical centres – whether primary judge erred in finding lump sum amounts made on revenue account for income tax purposes – whether primary judge erred by adopting narrow conception of nature of business – whether lump sum amounts paid to secure arrangements that formed part of profit-making structure of business – whether accounting treatment of lump sum amounts as goodwill supports claim that lump sum amounts made on capital account – consideration of distinction between capital and revenue expenditure – appeals allowed

Legislation: Income Tax Assessment Act 1997 (Cth) s 8-1, Part 3-90

Cases cited: AusNet Transmission Group Pty Ltd v Commissioner of Taxation [2015] HCA 25; (2015) 255 CLR 439 BP Australia Ltd v Federal Commissioner of Taxation (1965) 112 CLR 386 Commissioner of Taxation v Sharpcan Pty Ltd [2019] HCA 36 GP International Pipecoaters Pty Ltd v Commissioner of Taxation [1990] HCA 25; (1990) 170 CLR 124 Hallstroms Pty Ltd v Federal Commissioner of Taxation [1946] HCA 34; (1946) 72 CLR 634 Heavy Minerals Pty Ltd v Federal Commissioner of Taxation (1966) 115 CLR 512 National Australia Bank Ltd v Commissioner of Taxation (1997) 80 FCR 352 Primary Health Care Limited v Commonwealth of Australia [2016] FCA 313 Sun Newspapers Limited v Commissioner of Taxation (1938) 61 CLR 337 Tyco Australia Pty Ltd v Commissioner of Taxation [2007] FCA 1055