Cox and Commissioner of Taxation (Taxation)

This matter concerned an application by the Applicant taxpayer for release from certain taxation liabilities under section 340-5 of Schedule 1 of the *Taxation Administration Act 1953* (Cth). The Commissioner of Taxation was the respondent. The core of the dispute revolved around whether the Applicant would suffer "serious hardship" if required to satisfy his eligible taxation debts, a condition precedent to the Commissioner exercising discretion to grant a release.

The Tribunal was required to determine the meaning of "serious hardship" in the context of section 340-1 of the *Taxation Administration Act 1953* (Cth) and whether the Applicant met this threshold. This involved considering various factors, including the Applicant's income and outgoings, and his assets and liabilities. The Tribunal also had to distinguish between eligible and ineligible taxation liabilities for the purposes of release under the Act.

The Tribunal reasoned that the Applicant, who was no longer working as a subcontractor and was in receipt of a Newstart allowance, had minimal assets and no savings. His primary asset was a mortgaged residential property with an unfinished house, and a car of modest value. The Tribunal found that requiring the Applicant to satisfy his eligible taxation liabilities, which totalled $123,828.64, would indeed cause him serious hardship. Consequently, the Tribunal set aside the reviewable decision and substituted its own decision, granting the Applicant a full release from his eligible taxation debt, while noting he remained liable for the ineligible portion of $8,095.50.