Trustee for the Michael Hayes Family Trust v Commissioner of Taxation [2019] FCA 426

FEDERAL COURT OF AUSTRALIA

Trustee for the Michael Hayes Family Trust v Commissioner of Taxation [2019] FCA 426 File number: QUD 400 of 2017

Judge: LOGAN J

Date of judgment: 27 March 2019

Catchwords: TAXATION – income tax – trusts – whether a trust is a "public trading trust" pursuant to s 102R(1)(b) of the Income Tax Act 1936 (Cth) – whether trust is a public unit trust – application of s 102P(10) – whether the trust's "beneficial interest in property" of another trustee estate consists of the units of a unit trust – scope of "beneficial interest" necessary for s 102P(10) – whether trust is a "trading trust" operations of a trading business – whether trustee not liable under s 99A because it was not entitled to the net income of a trust TRUSTS – construction of trust deed – whether trust deed ambiguous – where trust deed identified "Second Absolute Beneficiary" as a named company "as trustee for" a specified superannuation fund – need to consider surrounding circumstances – whether named company or the trustee of the superannuation fund at the time the trust deed was made should be preferred TRUSTS – rectification of trust deed – whether rectification available as an alternative to construction – where deed of rectification entered into – use that can be made of deed of rectification – whether order of rectification would be appropriate as an alternative to construction

Legislation: Evidence Act 1995 (Cth) s 140 Federal Court of Australia Act 1976 (Cth) s 32 Income Tax Assessment Act 1936 (Cth) ss 99A, 102MD, 102N, 102P, 102Q, 102R Superannuation Industry (Supervision) Act 1993 (Cth) Taxation Administration Act 1953 (Cth) s 14ZZO, Pt IVC Partnership Act 1891 (Qld) ss 5, 12 Inheritance Tax Act 1984 (UK) s 142 Taxation of Chargeable Gains Act 1992 (UK) s 62