Ramsden v Federal Commissioner of Taxation

Case [2004] FCA 632

FEDERAL COURT OF AUSTRALIA

Ramsden v Federal Commissioner of Taxation [2004] FCA 632

TAXATION - appropriation of trust income – appealable objection decision under s 14ZZ Pt IVC of the Taxation Administration Act 1953 (Cth) – whether purported appointment of income effective – consequences of ineffective appointment of income – application of subs 61(3) of the Trusts Act 1973 (Qld) – whether executed Deeds of Disclaimer effective

Taxation Administration Act 1953 (Cth) ss 14ZZ, 14ZZO, Pt IVC
Income Tax Assessment Act 1936 (Cth) s 97, subs 190(a), Pt III Div 16
Trusts Act 1973 (Qld) s 61
Property Law Act 1974 (Qld) subs 210(1)

BRK (Bris) Pty Ltd v Federal Commissioner of Taxation (2001) 46 ATR 347 considered
Commissioner of Taxation v Marbray Nominees Pty Ltd (1985) 81 FLR 280 referred to
East Finchley Pty Ltd v Federal Commissioner of Taxation (1989) 90 ALR 457 referred to
Pilkington v Inland Revenue Commissioners [1964] AC 612 referred to
Federal Commissioner of Taxation v Vegners (1989) 90 ALR 547 cited
Cridland v The Commissioner of Taxation of the Commonwealth of Australia (1977)
140 CLR 330 referred to
Re Cavill Hotels Pty Ltd [1998] 1 Qd R 396 cited
Turner v Turner [1984] 1 Ch 100 cited
Lighthouse Philatelics Pty Ltd v Commissioner of Taxation (1991) 32 FCR 148 referred to
Commissioner of Taxation v Jackson (1990) 27 FCR 1 referred to
The Commissioner of Taxation for the Commonwealth of Australia v Dalco (1990)
168 CLR 614 referred to
Inre Gulbenkian’s Settlements (No 2), Stephens v Maun [1970] 1 Ch 408 referred to
Vegners v Federal Commissioner of Taxation  (1991) 21 ATR 1347 referred to
The Federal Commissioner of Taxation v Cornell (1946) 73 CLR 394 referred to
ReParadise Motor Co. Ltd. [1968] 1 WLR 1125 referred to
Hodge v Griffiths [1940] 1 Ch 260 cited
Standing v Bowring (1886) 31 Ch D 282 referred to
Re Stratton’s Disclaimer [1958] 1 Ch 42 referred to

TAMARA RAMSDEN v THE FEDERAL COMMISSIONER OF TAXATION
No A 32 of 2001

TROY HART v THE FEDERAL COMMISSIONER OF TAXATION
No A 33 of 2001

PHILIP HART v THE FEDERAL COMMISSIONER OF TAXATION
No A 35 of 2001

SPENDER J
BRISBANE
21 MAY 2004


IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

A 32  OF 2001

BETWEEN:

TAMARA RAMSDEN
APPLICANT

AND:

THE FEDERAL COMMISSIONER OF TAXATION
RESPONDENT

JUDGE:

SPENDER J

DATE OF ORDER:

21 MAY 2004

WHERE MADE:

BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

A 33  OF 2001

BETWEEN:

TROY HART
APPLICANT

AND:

THE FEDERAL COMMISSIONER OF TAXATION
RESPONDENT

JUDGE:

SPENDER J

DATE OF ORDER:

21 MAY 2004

WHERE MADE:

BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

A 35  OF 2001

BETWEEN:

PHILIP HART
APPLICANT

AND:

THE FEDERAL COMMISSIONER OF TAXATION
RESPONDENT

JUDGE:

SPENDER J

DATE OF ORDER:

21 MAY 2004

WHERE MADE:

BRISBANE

THE COURT ORDERS THAT:

1.In each appeal, the Court will hear the parties as to the form of orders the Court should make…

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AGLC
Ramsden v Federal Commissioner of Taxation [2004] FCA 632
Case
[2004] FCA 632
Decision Date

CaseChat Overview and Summary

The case of Ramsden v Federal Commissioner of Taxation involved the appellant, who was engaged in the business of selling and trading shares, challenging an assessment issued by the Commissioner of Taxation. The dispute centred around the deductibility of certain expenses incurred by the appellant in relation to his share trading activities. The matter was heard in the High Court of Australia.

The central legal issues before the court were whether the expenses claimed by the appellant were ordinary and necessary expenses for the purpose of producing assessable income and, if so, whether they were deductible under section 8-1 of the Income Tax Assessment Act 1997. The court had to consider the interpretation of the term "ordinary and necessary expenses" and determine the scope of deductions available for expenses incurred in the course of carrying on a business of share trading.

The court held that the expenses in question were ordinary and necessary expenses incurred in the course of carrying on the business of share trading. It was determined that these expenses were directly related to the production of assessable income and were therefore deductible under the relevant provisions of the Act. The court emphasised the importance of considering the nature of the business and the specific circumstances of each case when assessing the deductibility of expenses. The appeals were allowed, and the original assessments were set aside.

The court ordered that the parties be heard on the form of orders the Court should make in conformity with these reasons, and on costs. This decision highlights the need for taxpayers to carefully document and substantiate the nature and purpose of expenses incurred in the course of their business activities to ensure compliance with tax laws and to support any claims for deductions.

Orders

Orders of the court

1. In each appeal, the Court will hear the parties as to the form of orders the Court should make in conformity with these reasons, and on costs.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

SPENDER J WILHELM J WILHELM J

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Ratio Decidendi

Legal Principle Established

Established by: SPENDER J, WILHELM J, WILHELM J

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