H R C Hotel Services Pty Ltd v Chief Commissioner of State Revenue [2018] NSWSC 820

Supreme Court New South Wales

Medium Neutral Citation: H R C Hotel Services Pty Ltd v Chief Commissioner of State Revenue [2018] NSWSC 820 Hearing dates: 28 February 2018, 1 March 2018 Date of orders: 05 June 2018 Decision date: 05 June 2018 Jurisdiction: Equity Before: Ward CJ in Eq Decision: (1) Dismiss the plaintiffs' further amended summons filed 2 August 2017. (2) Order the plaintiffs to pay the defendant's costs of the proceedings on the ordinary basis. Catchwords: TAXES AND DUTIES – pay-roll tax – employment agency contracts – interpretation of s 37(1) of the Payroll Tax Act 2007 (NSW) – meaning of "under which" – meaning of "procures the services of another person" – meaning of "for a client"

TAXES AND DUTIES – pay-roll tax – employment agency contracts – amounts taken to be wages – interpretation of s 40(1)(a) of the Payroll Tax Act 2007 (NSW)

TAXES AND DUTIES – pay-roll tax – penalty tax – whether taxpayer took "reasonable care to comply with the taxation law" within the meaning of s 27(3)(a) of the Taxation Administration Act 1996 (NSW) Legislation Cited: Interpretation Act 1987 (NSW), ss 33, 34 Payroll Tax Act 1971 (NSW), s 3C Payroll Tax Act 2007 (NSW), ss 3(1), 6, 7, 9(1), 13(1)(e), 31, 32, 35, 37, 38, 39, 40, 41, 46, 71, 81, 87 Payroll Tax Act 2007 (Vic), s 37 Pay-roll Tax Assessment Act 1941 (Cth) Revenue Ruling No. PTA 027 (NSW Office of State Revenue, 30 June 2008) Supreme Court Act 1970 (NSW), s 19(2) Taxation Administration Act 1996 (NSW), ss 26, 27, 29, 45, 97, 100(3), 101(1)(d) Cases Cited: 2 Elizabeth Bay Road Pty Ltd v The Owners – Strata Plan No 73943 (2014) 88 NSWLR 488; [2014] NSWCA 409 Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 Asciano Services Pty Ltd v Chief Commissioner of State Revenue (NSW) (2008) 235 CLR 602; [2008] HCA 46 Baini v The Queen (2012) 246 CLR 469; [2012] HCA 59 BTR Engineering (Australia) Ltd v Dana Corporation [2000] VSC 246 Caltex Oil (Australia) Pty Ltd v Feenan [1981] 1 NSWLR 169; [1981] 1 WLR 1003 Caterpillar of Australia Pty Ltd v Industrial Court of New South Wales (2009) 78 NSWLR 43; [2009] NSWCA 83 Chief Commissioner of State Revenue v Paspaley [2008] NSWCA 184 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2 Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41; [1931] HCA 53 Coverdale v West Coast Council (2016) 259 CLR 164; [2016] HCA 15 CXC Consulting Pty Ltd v Commissioner of State Revenue (Taxation) [2012] VCAT 1992 CXC Consulting Pty Ltd v Commissioner of State Revenue [2013] VSC 492; (2013) 96 ATR 796 Federal Commissioner of Taxation v Sara Lee Household & Body Care (Australia) Pty Ltd (2000) 201 CLR 520; [2000] HCA 35 Fish v Solution 6 Holdings Ltd (2006) 225 CLR 180; [2006] HCA 22 Freelance Global Ltd v Chief Commissioner of State Revenue [2014] NSWSC 127 Grain Growers Ltd v Chief Commissioner of State Revenue [2015] NSWSC 925 Hancock Prospecting Pty Ltd v Rinehart [2017] FCAFC 170; (2017) 350 ALR 658 Hollis v Vabu Pty Ltd (2001) 207 CLR 21; [2001] HCA 44 House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498; [2000] NSWCA 44 JP Property Services Pty Ltd v Chief Commissioner of State Revenue [2017] NSWSC 1391 Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210; [1963] HCA 26 McDonald's Australia Holdings Ltd v Industrial Relations Commission of NSW [2005] NSWCA 286; (2005) 223 ALR 78 Mutual Acceptance Co Ltd v Federal Commissioner of Taxation (1944) 69 CLR 389; [1944] HCA 34 On Call Interpreters and Translators Agency Pty Ltd v Federal Commissioner of Taxation (No 3) (2011) 214 FCR 82; [2011] FCA 366 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 Qualweld Australia Pty Ltd v Chief Commissioner of State Revenue [2015] NSWCATAP 249 Qualweld Australia Pty Ltd v Chief Commissioner of State Revenue [2014] NSWCATAD 227; (2014) 100 ATR 339 Rinehart v Hancock Prospecting Pty Ltd [2018] HCA Trans 90 (18 May 2018) Rinehart v Welker (2012) 95 NSWLR 221; [2012] NSWCA 95 RVO Enterprises Pty Ltd v Chief Commissioner of State Revenue [2004] NSWADT 64; (2004) 55 ATR 445 Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252; [2010] HCA 23 Sydney Flooring Pty Ltd v Chief Commissioner of State Revenue [2017] NSWCATAD 96; (2017) 105 ATR 546 SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 91 ALJR 936 Tasty Chicks Pty Ltd v Chief Commissioner of State Revenue (2011) 245 CLR 446; [2011] HCA 41 TCL Airconditioner (Zhongshan) Co Ltd v Castel Electronics Pty Ltd [2009] VSC 553 UNSW Global Pty Ltd v Chief Commissioner of State Revenue [2016] NSWSC 1852; (2016) 104 ATR 577 Value Engineering (Australasia) Pty Ltd v State Commissioner of Taxation (WA) (1985) 16 ATR 296 Winday International Pty Ltd v Chief Commissioner of State Revenue [2016] NSWCATAD 270; (2016) 104 ATR 125 Workers' Compensation Board of Queensland v Technical Products Pty Ltd (1988) 165 CLR 642; [1988] HCA 28 Category: Principal judgment Parties: H R C Hotel Services Pty Ltd (First Plaintiff) Hotel Operations Solutions Pty Ltd (Second Plaintiff) Chief Commissioner of State Revenue (Defendant) Representation: Counsel: S Kaur-Bains with A Gerard (Plaintiffs) S Balafoutis with D Stretton (Defendant)