Commissioner of Taxation v Mercantile Mutual Insurance (Workers Compensation) Ltd [1999] FCA 351

FEDERAL COURT OF AUSTRALIA

Commissioner of Taxation v Mercantile Mutual Insurance (Workers Compensation) Ltd [1999] FCA 351

INCOME TAX – deductions – insurance – whether deductions allowable under s 51(1) for amounts taxpayer estimates it will be required to outlay to settle insurance claims reported but not settled in the year of income and insurance claims incurred but not reported in the year of income or whether deduction limited to provision made in accounts reflecting the present value of future claims. Income Tax Assessment Act 1936: s 51(1) Commissioner of Taxation v Manufacturers' Mutual Insurance Limited (1931) 31 SR (NSW) 575 followed Ballarat Brewing Co Ltd v Federal Commissioner of Taxation (1951) 82 CLR 364 cited Texas Co (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382 followed RACV Insurance Pty Ltd v Commissioner of Taxation [1975] VR 1 cited Commercial Union Assurance Co of Australia Ltd v Federal Commissioner of Taxation (1977) 32 FLR 32 cited Federal Commissioner of Taxation v James Flood Pty Ltd (1953) 88 CLR 492 cited Nilsen Development Laboratories Pty Ltd v Federal Commissioner of Taxation [1981] 144 CLR 616 referred to Coles Myer Finance Ltd v Commissioner of Taxation (1993) 176 CLR 640 referred to Australia and New Zealand Banking Group Ltd v Commissioner of Taxation (1994) 48 FCR 268 cited Commissioner of Taxation v The Myer Emporium Ltd (1986-7) 163 CLR 199 cited Commissioner of Taxation v Orica (1998) 154 ALR 1 cited Burrill v Commissioner of Taxation (1969) 67 FCR 519 referred to Commissioner of Inland Revenue v Mitsubishi Motors New Zealand Ltd [1996] AC 315 cited New Zealand Flax Investments Ltd v Federal Commissioner of Taxation (1938) 61 CLR 179 cited

Ogilvy & Mather Pty Ltd v Commissioner of Taxation (1990) 95 ALR 663 approved Commissioner of Taxation v Raymor (1990) 24 FCR 90 referred to J Rowe & Son Pty Ltd v Federal Commissioner of Taxation (1971) 124 CLR 421 cited W Nevill & Co Ltd v Commissioner of Taxation (1937) 56 CLR 290 referred to Commissioner of Taxation v Energy Resources of Australia Ltd (1996) 185 CLR 66 cited Federal Commissioner of Taxation v Australian Guarantee Corporation Ltd (1984) 2 FCR 483 referred to Commissioner of Taxation v Woolcombers (WA) Pty Ltd (1993) 47 FCR 561 cited Merchant v Commissioner of Taxation [1999] FCA 49 referred to