Orica Limited v Commissioner of Taxation [2015] FCA 1399

FEDERAL COURT OF AUSTRALIA

Orica Limited v Commissioner of Taxation [2015] FCA 1399 Citation: Orica Limited v Commissioner of Taxation [2015] FCA 1399

Parties: ORICA LIMITED v COMMISSIONER OF TAXATION

File numbers: VID 43 of 2015 VID 44 of 2015 VID 45 of 2015 VID 46 of 2015 VID 47 of 2015 VID 48 of 2015

Judge: PAGONE J

Date of judgment: 7 December 2015

Catchwords: INCOME TAX – tax avoidance – schemes to reduce income tax – dominant purpose of obtaining tax benefit – intra-group refinancing arrangement – generation of interest income to utilise tax losses – deductions claimed in relation to interest payments – matters to which court must have regard to determine whether dominant purpose of obtaining tax benefit – whether it would be concluded that participant in schemes had dominant purpose of obtaining tax benefit – relevance of commercial purpose – relevance of subjective intention of taxpayer INCOME TAX – scheme shortfall penalty – whether reasonable to conclude that entity entered into or carried out scheme for sole or dominant purpose of getting scheme benefit – whether subjective or objective purpose of taxpayer relevant – whether position reasonably arguable

Legislation: Income Tax Assessment Act 1936 (Cth) ss 23AJ, 177C, 177D, 177EA, 177F, 222C, 226K Income Tax Assessment Act 1997 (Cth) ss 8-1, 25-90, Part 3-90 Taxation Administration Act 1953 (Cth) Sch 1 ss 284-15, 284-145, 284-160 Tax Laws Amendment (Improvements to Self Assessment) Act (No 1) 2005 (Cth) Explanatory Memorandum to the Tax Laws Amendment (Improvements to Self Assessment) Bill (No 1) 2005