Starr v Commissioner of Taxation of the Commonwealth of Australia [2007] FCA 23

FEDERAL COURT OF AUSTRALIA

Starr v Commissioner of Taxation of the Commonwealth of Australia [2007] FCA 23

TAXATION – income tax – penalty – tax shortfall – derived from treating income tax law as applying in relation to a tax avoidance scheme – tax avoidance scheme – whether entered into or carried out for the sole or dominant purpose of enabling a person to pay no or less tax – subjective or objective determination – subjective inquiry – appeal allowed "purpose" Income Tax Assessment Act 1936 (Cth) s 226L, s 222A(1), s 177A, s 177D Taxation Administration Act 1953 (Cth) Vincent v Federal Commissioner of Taxation (2002) 124 FCR 350; 193 ALR 686 cited Edgington v Fitzmaurice [1885] 29 Ch D 459 Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 cited News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 215 CLR 563 cited Chandler v Director of Public Prosecutions [1964] AC 763 cited Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 cited ASX Operations Pty Ltd v Pont Data Australia Pty Ltd (No 1) (1990) 27 FCR 460 cited Eastern Express Pty Ltd v General Newspapers Pty Ltd (1992) 35 FCR 43; 106 ALR 297 cited Universal Music Australia Pty Ltd v Australian Competition and Consumer Commission (2003) 131 FCR 529 cited Krampel Newman v Commissioner of Taxation (2003) 126 FCR 561 cited Newton v Federal Commissioner of Taxation (1958) 98 CLR 1 cited

Cheshire and Fifoot, Law of Contract(8th Australian Edition, LexisNexis, Butterworths 2002) Parsons, Income Taxation in Australia (Law Book Co, 1985) DONALD ST CLAIR STARR AND GARY KEVIN HOPKINS v COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA WAD262 OF 2005

FRENCH J

23 JANUARY 2007

PERTH IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY WAD262 OF 2005

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL