Fowler v Commissioner of Taxation [2012] FCA 1040

FEDERAL COURT OF AUSTRALIA

Fowler v Commissioner of Taxation [2012] FCA 1040 Citation: Fowler v Commissioner of Taxation [2012] FCA 1040

Parties: MICHAEL PATRICK FOWLER v COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

File number: VID 992 of 2010

Judge: KENNY J

Date of judgment: 21 September 2012

Catchwords: TAXATION — employee share schemes — where director received options to unissued shares in lieu of cash remuneration — date on which director acquired right to shares — where grant of options conditional on the shareholders' approval — where approval was expected — nature of right acquired — meaning of "right" in Division 13A of the Income Tax Assessment Act 1936 (Cth) — right for the purposes of Division 13A acquired only upon the shareholders' approval — Income Tax Assessment Act 1936 (Cth) s 139G. TAXATION — administrative penalties — failure to take reasonable care to comply with a taxation law — where no amount returned in respect of options granted in lieu of cash remuneration — where taxpayer mistaken as to date right to shares acquired — where no evidence of enquiries into tax treatment of options — reasonable care test distinct from reasonably arguable position test — administrative penalty justified — Taxation Administration Act 1953 (Cth) s 284-90.

Legislation: Income Tax Assessment Act 1936 (Cth) Taxation Administration Act 1953 (Cth) Corporations Act 2001 (Cth)

Cases cited: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT) (2009) 239 CLR 27 Commissioner of Taxation v McWilliam [2012] FCAFC 105 Green v Crusader Oil NL (1985) 10 ACLR 120 Laybutt v Amoco Australia Pty Ltd (1974) 132 CLR 57 Hilder v Dexter [1902] AC 474 Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 Commissioner of Taxes (Qld) v Camphin (1937) 57 CLR 127 O'Neill v O'Connell (1946) 72 CLR 101 at 129 Adamson v Hayes (1973) 130 CLR 276 Re Henderson's Caveat [1998] 1 Qd R 632 Forder v Cemcorp Pty Ltd (2001) 51 NSWLR 486 McWilliam v McWilliam's Wines Pty Ltd (1964) 114 CLR 656 Brown v Heffer (1967) 116 CLR 344 Perri v Coolangatta Investments Pty Ltd (1982) 149 CLR 537 Butts v O'Dwyer (1952) 87 CLR 267 Kennedy v Vercoe (1960) 105 CLR 521 Legione v Hateley (1983) 152 CLR 406 KLDE Pty Ltd v Commissioner of Stamp Duties (Qld) (1984) 155 CLR 288 Baden Pacific Ltd v Portreeve Pty Ltd (1988) 14 ACLR 677 Affinity Health Ltd v Chief Commissioner of State Revenue (NSW) (2005) 60 ATR 1 Hill End Gold Ltd v First Tiffany Resource Corporation [2010] NSWSC 375 GPT RE Ltd v Lend Lease Real Estate Investments Ltd [2005] NSWSC 964 Lend Lease Real Estate Investments Ltd v GPT RE Ltd [2006] NSWCA 207 Dekala Pty Ltd (in liq) v Perth Land & Leisure Ltd (1987) 17 NSWLR 664 Australian Securities and Investments Commission v Carey (No 6) (2006) 153 FCR 509 Bahr v Nicolay [No 2] (1988) 164 CLR 604 Handbury Holdings Pty Ltd v Federal Commissioner of Taxation (2008) 74 ATR 560 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 Wilkie v Gordian Runoff Ltd (2005) 221 CLR 522 McCann v Switzerland Insurance Australia Ltd (2000) 203 CLR 579 Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd [1985] 2 NSWLR 309 Fraunschiel v Federal Commissioner of Taxation (1989) 20 ATR 955 Pascoe v Federal Commissioner of Taxation (1956) 30 ALJR 402 Federal Commissioner of Taxation v SNF (Australia) Pty Ltd (2011) 193 FCR 149 Revlon Manufacturing Ltd v Commissioner of Taxation (1995) 63 FCR 535 Commissioner of Taxation v Traviati [2012] FCA 546 Aurora Developments Pty Ltd v Federal Commissioner of Taxation (No 2) (2011) 196 FCR 457 Walstern Pty Ltd v Commissioner of Taxation (2003) 138 FCR 1 North Ryde RSL Community Club Ltd v Commissioner of Taxation (2002) 121 FCR 1 MLC Ltd v Commissioner of Taxation (2002) 126 FCR 37 Sent v Commissioner of Taxation [2012] FCA 382