Zeta Force Pty Ltd v The Commissioner of Taxation of the Commonwealth of Australia [1998] FCA 728

FEDERAL COURT OF AUSTRALIA INCOME TAX ‑ Trust income ‑ Beneficiary presently entitled to share of income of trust estate ‑ Assessable income of beneficiary to include "that share of the net income of the trust estate" ‑ Net income exceeds distributable income ‑ Whether trustee or beneficiary assessable on excess. INCOME TAX ‑ Penalties ‑ Penalty for false statement by taxpayer ‑ Penalty for false statement by trustee relating to trust estate ‑ Whether as taxpayer beneficiary liable to penalty for false statement where trustee omits to return income of trust estate.

Income Tax Assessment Act 1922, s 31 Income Tax Assessment Act 1936, ss 95, 97, 99, 99A.

Executor Trustee and Agency Company of South Australia v Federal Commissioner of Taxation (1932) 48 CLR 26 distinguished Tindal v Federal Commissioner of Taxation (1946) 72 CLR 608 considered Federal Commissioner of Taxation v Belford (1952) 88 CLR 589 considered Union‑Fidelity Trustee Co of Australia Limited v Federal Commissioner of Taxation (1969) 119 CLR 177 mentioned Davis v Federal Commissioner of Taxation (1989) 86 ALR 195 considered and applied Richard Walter Pty Ltd v Federal Commissioner of Taxation (1995) 31 ATR 95 considered Peabody v Federal Commissioner of Taxation (1992) 24 ATR 58 considered Grollo Nominees Pty Ltd v Federal Commissioner of Taxation (1997) 73 FCR 452 considered Richardson v Federal Commissioner of Taxation (1997) 150 ALR 167 considered Federal Commissioner of Taxation v Prestige Motors Pty Ltd (1998) 98 ATC 4241 mentioned Saraswati v The Queen (1991) 172 CLR 1 mentioned Federal Commissioner of Taxation v Turner (1984) 84 ATC 4161 mentioned Reliance Finance Corporation Pty Ltd v Federal Commissioner of Taxation (1987) 87 ATC 4146 mentioned ZETA FORCE PTY LTD v THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA VG 424 of 1997 [074] SUNDBERG J 29 JUNE 1998 MELBOURNE