Starrim Pty Ltd v Commissioner for Taxation [2000] FCA 952

FEDERAL COURT OF AUSTRALIA

Starrim Pty Ltd v Commissioner of Taxation [2000] FCA 952

FRINGE BENEFITS TAX – expense payment benefits and loan benefits – husband and wife occupying various relationships to company in addition to being its only directors and shareholders – they purchase unsubdivided property comprising 32 acres including 1 acre for residence and curtilage where they reside and the remaining 31 acres which they make available to their company free of charge for its business purposes (nursery and farming) – they mortgage the land as security for borrowing by company – company uses part of money borrowed to buy business and on-lends balance to the couple to enable them to purchase the land – company pays local government rates, electricity charges, telephone bills and interest on vendor finance for the whole property including the one-acre residential part – whether the benefits provided by the company to the couple were "in respect of" their employment by the company or "in respect of" one or other of their other relationships to the company, such as "landowners", "shareholders", "security providers".

Fringe Benefits Tax Assessment Act 1986 (Cth)subs 136(1) ("in respect of") J & G Knowles Pty Ltd v Commissioner of Taxation [2000] FCA 196, applied STARRIM PTY LIMITED v COMMISSIONER OF TAXATION N 1114 OF 1999 LINDGREN J 14 JULY 2000 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 1114 OF 1999

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN: STARRIM PTY LIMITED

APPLICANT

AND: COMMISSIONER OF TAXATION

RESPONDENT

JUDGE: LINDGREN J

DATE OF ORDER: 14 JULY 2000

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The appeal be allowed.

2. The decision dated 31 August 1999 of the Administrative Appeals Tribunal in NT98/43, 47 and 48 (Fringe Benefits Tax) affirming objection decisions of the respondent in respect of expense payment benefits be set aside.