Robson as trustee for the bankrupt estate of Lanning v Commissioner of Taxation [2024] FCA 720

Federal Court of Australia

Robson as trustee for the bankrupt estate of Lanning v Commissioner of Taxation [2024] FCA 720 File number(s): QUD 283 of 2023

Judgment of: DOWNES J

Date of judgment: 4 July 2024

Catchwords: TAXATION – capital gains tax – where trustee in bankruptcy sold two properties of bankrupt – where capital gain resulted from sales – consideration of s 254 of Income Tax Assessment Act 1936 (Cth) and whether it applies to trustee in bankruptcy – whether capital gain derived in representative capacity – consideration of s 106-30 of Income Tax Assessment Act 1997 (Cth) – whether trustee in bankruptcy has ancillary tax liability BANKRUPTCY AND INSOLVENCY – liability of trustee in bankruptcy to pay capital gains tax on real property which vested in trustee and was then sold – determined that trustee has ancillary tax liability

Words & phrases: "representative capacity"

Legislation: Bankruptcy Act 1966 (Cth) ss 58, 109 Income Tax Assessment Act 1936 (Cth) ss 6, 160W, 254 Income Tax Assessment Act 1997 (Cth) ss 6-5(4), 106-30 Income Tax Assessment Amendment (Capital Gains) Act 1986 (Cth) Taxation Administration Act 1953 (Cth) ss 14ZZ, 14ZZO, Sch 1 Div 359

Cases cited: Brent v Commissioner of Taxation (1971) 125 CLR 418 Commissioner of State Revenue v EHL Burgess Properties Pty Ltd (2015) 209 LGERA 314; [2015] VSCA 269 Commissioner of Taxation v Australian Building Systems Pty Ltd (in liq) (2015) 257 CLR 544; [2015] HCA 48 Commissioner of Taxes (SA) v Executor Trustee and Agency Company of South Australia Limited (1938) 63 CLR 108 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22 Webb v Syme (1910) 10 CLR 482