Bayton Cleaning Company Pty Ltd v Chief Commissioner of State Revenue; International Hotel Services Pty Ltd v Chief Commissioner of State Revenue [2019] NSWSC 657

Supreme Court New South Wales

Medium Neutral Citation: Bayton Cleaning Company Pty Ltd v Chief Commissioner of State Revenue; International Hotel Services Pty Ltd v Chief Commissioner of State Revenue [2019] NSWSC 657 Hearing dates: 11 and 12 February 2019 Decision date: 07 June 2019 Jurisdiction: Equity Before: Ward CJ in Eq Decision: Dismiss the plaintiff's claim with costs in each of the proceedings. Catchwords: TAXES AND DUTIES – payroll tax – employment agency contracts – interpretation of s 37(1) of the Payroll Tax Act 2007 (NSW) – meaning of "employment agency contract"

TAXES AND DUTIES – payroll tax – employment agency contracts –s 32(2)(c) of the Payroll Tax Act 2007 (NSW) – whether the "two-person" exemption applies

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

TAXES AND DUTIES – payroll 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: Duties Act 1997 (NSW), Ch 4 Payroll Tax Act 1971 (NSW), s 3C Payroll Tax Act 2007 (NSW), ss 6, 7, 9, 13, 25, 27, 29, 32, 33, 35, 37, 38, 39, 40, 41, 46, 86, 87, 97, Sch 2, Pt 5 Taxation Administration Act 1996 (NSW), ss 3, 4, 9, 21, 22, 25, 27, 29, 33, 97, 100, 101 Workers Compensation Act 1987 (NSW), s 163A Cases Cited: 671122 Ontario Ltd v Sagaz Industries Canada Inc [2001] SCC 59, [2001] 2 RCS 983 ABC Staff Hire Pty Limited v Chief Commissioner of State Revenue [2018] NSWCATAD 137 Allied Pastoral Holdings Pty Ltd v Commissioner of Taxation [1983] 1 NSWLR 1; (1983) 44 ALR 607 Al-Saeed and Associates Pty Ltd atf Al-Saeed Education and Welfare Trust v Chief Commissioner of State Revenue [2014] NSWCATAP 11 B&L Linings v Chief Commission of State Revenue (No 3) [2007] NSWADTAP 32 B&L Linings v Chief Commissioner of State Revenue (2008) 74 NSWLR 481; [2008] NSWCA 187 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA Commissioner of State Revenue (Vic) v Snowy Hydro Ltd [2012] VSCA 145; (2012) 43 VR 109 Commissioner of Taxation of the Commonwealth of Australia v Murry (1998) 193 CLR 605; [1998] HCA 42 Freelance Global Ltd v Chief Commissioner of State Revenue [2014] NSWSC 127 Grain Growers Limited v Chief Commissioner of State Revenue (NSW) [2016] NSWCA 359 Hollis v Vabu Pty Ltd (2001) 207 CLR 21; [2001] HCA 44 HRC Hotel Services Pty Ltd v Chief Commissioner of State Revenue [2018] NSWSC 820 Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 JP Property Services Pty Limited v Chief Commissioner of State Revenue [2017] NSWSC 1391 Lease A Leaf Property Pty Limited v Chief Commissioner of State Revenue [2011] NSWADTAP 41 Levitch Design Associates Pty Ltd ATF Levco Unit Trust v Chief Commissioner of State Revenue [2014] NSWCATAD 215 Madikian v Chief Commissioner of State Revenue [2017] NSWCATAD 263 Mutual Acceptance Co Ltd v Federal Commissioner of Taxation (1944) 69 CLR 389; [1944] HCA 34 MW v Director-General, Department of Community Services [2008] HCA 12; (2008) 82 ALJR 629 Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 253 CLR 219; [2014] HCA 34 Project Blue Sky v Australia Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 Qualweld Australia Pty Ltd v Chief Commissioner of State Revenue [2014] NSWCATAD 227; (2014) 100 ATR 339 Queensland Stations Pty Ltd v FCT (1945) 70 CLR 539; [1995] HCA 13 Raftland Pty Ltd v Commissioner of Taxation (2006) 227 ALR 598 Richard Walter Pty Ltd v Commissioner of Taxation (1996) 67 FCR 243 RVO Enterprises Pty Ltd v Chief Commissioner of State Revenue [2004] NSWADT 64; (2004) 55 ATR 445 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 Thomas v Commissioner of Taxation [2015] FCA 968 UNSW Global Pty Ltd v Chief Commissioner of State Revenue [2016] NSWSC 1852; (2016) 104 ATR 577 Winday International Pty Ltd v Chief Commissioner of State Revenue [2016] NSWCATAD 270 Winston-Smith v Chief Commissioner of State Revenue [2018] NSWSC 773 Winston-Smith v Chief Commissioner of State Revenue [2019] NSWCA 75 Workers' Compensation Board of Queensland v Technical Products Pty Ltd (1988) 165 CLR 642; [1988] HCA 49 World Book (Aust) Pty Ltd v Commissioner of Taxation (1992) 27 NSWLR 377 Texts Cited: Explanatory Note, Payroll Tax Bill 2007 (NSW) New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 13 November 1985, 9557-9559 Category: Principal judgment Parties: Bayton Cleaning Company Pty Ltd (Plaintiff) International Hotel Services Pty Ltd (Plaintiff) Chief Commissioner of State Revenue (Defendant) Representation: Counsel: R Seiden SC, M Sealey, N Gangemi (Plaintiffs) S Balafoutis, D Stretton (Defendant)