TBCL and Commissioner of Taxation (Taxation)

The Administrative Appeals Tribunal reviewed objection decisions made by the Commissioner of Taxation concerning private rulings issued to the applicants, Mr and Mrs TBCL. The dispute arose from the Commissioner's ruling that the applicants were not death benefits dependants of their deceased son, meaning a $500,000 life insurance payout from his superannuation scheme was assessable income. The applicants sought to have this payout treated as non-assessable income under section 302-60 of the *Income Tax Assessment Act 1997* (Cth) on the basis that they were death benefits dependants.

The Tribunal was required to determine whether the applicants qualified as death benefits dependants of their son, specifically considering the definition of an "interdependency relationship" as outlined in section 302-200 of the *Income Tax Assessment Act 1997* (Cth) and Regulation 302-200.02 of the *Income Tax Regulations 1997* (Cth). This involved assessing whether the applicants and their son had a close personal relationship, lived together, and whether there was mutual financial, domestic, and personal care support, or if any of these elements were absent due to disability or temporary separation. A further issue was the function of the Tribunal in relation to private rulings when additional information, materially different from the facts presented in the original application, is introduced.

The Tribunal reasoned that the private ruling process requires the Commissioner to consider the facts comprising the scheme as presented in the application. In this instance, additional information was provided that was "materially different" from the facts on which the original private ruling was based. Under section 359-65(3)(a) of the *Taxation Administration Act 1953* (Cth), the Commissioner is obliged to request a new application for a private ruling when such materially different information comes to light. While the Tribunal could make such a request, it was deemed administratively more convenient for the matter to be remitted to the Commissioner to make this request. The Tribunal noted that while it considered the private ruling to be correct based on the information available, the legislative scheme meant the objection decision could not be affirmed.

Consequently, the Tribunal remitted the applications to the Commissioner of Taxation with a direction to request the applicants to make another application for a private ruling, in accordance with the Tribunal's reasons.