Fragmentary Pty Ltd and Screen Australia (Taxation)

Fragmentary Pty Ltd (the applicant) sought a review of a decision by Screen Australia concerning its eligibility for the producer tax offset. The dispute centred on whether the applicant had carried out, or made the arrangements for the carrying out of, all activities necessary for the making of the film, a prerequisite for qualifying Australian production expenditure. The matter was heard by Senior Member A Poljak.

The primary legal issue before the Tribunal was to determine whether the applicant met the requirements of subsection 376-65(1) of the relevant legislation, which mandates that the applicant must have carried out, or made arrangements for the carrying out of, all activities necessary for the making of the film. This determination was crucial for the applicant to satisfy the conditions for the producer tax offset.

The Tribunal found that the applicant had not satisfied the conditions under subsection 376-65(1). The reasoning focused on the timing of the applicant's registration as a company, which occurred on 3 May 2019, after significant pre-production, principal photography, and substantial post-production activities had already taken place. The Tribunal noted that the definition of "making of a film" encompasses pre-production, production, and post-production activities, but does not include the initial development of the proposal. Given that the applicant was not incorporated until after these essential stages were largely completed, it could not have carried out or arranged for these activities.

Consequently, the Tribunal concluded that the statutory obligation to issue a final certificate in relation to the producer offset was not enlivened. The decision under review by Screen Australia was affirmed.