Taras Nominees Pty Ltd as Trustee for the Burnley Street Trust v Commissioner of Taxation of the Commonwealth of Australia [2014] FCA 1

FEDERAL COURT OF AUSTRALIA

Taras Nominees Pty Ltd as Trustee for the Burnley Street Trust v Commissioner of Taxation of the Commonwealth of Australia [2014] FCA 1 Citation: Taras Nominees Pty Ltd as Trustee for the Burnley Street Trust v Commissioner of Taxation of the Commonwealth of Australia [2014] FCA 1

Parties: TARAS NOMINEES PTY LTD AS TRUSTEE FOR THE BURNLEY STREET TRUST v THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

File number: VID 1196 of 2011

Judge: KENNY J

Date of judgment: 14 January 2014

Catchwords: INCOME TAX – Capital Gains Tax –– Land conveyance by applicant to Land Trustee in connection with Joint Venture Agreement and Trust Deed - Whether taxable gain made by applicant - Whether trust created over asset by settlement– Whether land conveyance transferred CGT asset to an existing trust - Whether land conveyance disposed of the land - Whether applicant absolutely entitled to CGT asset against Land Trustee – Whether CGT exemptions in s 104-55(5), s 112-25, s 104-60(5) of the Income Tax Assessment Act 1977 (Cth) applied to Commissioner's assessment of CGT liability - Whether s 106-50 applied to actions of applicant in conveying land to Land Trustee - Consideration of proper method for determination of market value of Land – CGT event occurred. INCOME TAX – Imposition of administrative penalties – Whether applicant treated an income tax law as applying in a way not reasonably arguable – Whether applicant failed to exercise reasonable care to comply with an income tax law – Applicant liable to imposition of administrative penalties.

Legislation: Taxation Administration Act 1953 (Cth) Income Tax Assessment Act 1997 (Cth) Stamps Act 1958 (Vic) Income Tax Assessment Act 1936 (Cth) Land Trust Act 1958 (Vic)