WLQC and Commissioner of Taxation (Taxation)

The Administrative Appeals Tribunal considered a dispute between WLQC and the Commissioner of Taxation concerning income tax assessments for the 2004 income year. The applicant sought to object to "nil assessments" issued by the Commissioner, arguing that the companies should be treated as part of a tax consolidated group. The Commissioner contended that each entity's tax affairs should be considered in isolation and that a nil assessment is not an assessment capable of review.

The primary legal issues before the Tribunal were whether a nil assessment constitutes an "assessment" for the purposes of section 175A of the *Income Tax Assessment Act 1936* (Cth) as it applied in the 2004 income year, and consequently, whether the applicant could validly object to such a nil assessment under section 175A(2) of the same Act.

The Tribunal reasoned that section 175A of the *Income Tax Assessment Act 1936* permits a taxpayer dissatisfied with an "assessment" to object. The definition of "assessment" in section 6 of the Act, at the relevant time, included the ascertainment of the amount of taxable income and the tax payable thereon. Section 166 of the Act further stipulated that the Commissioner shall make an assessment of the amount of taxable income and the tax payable. The Tribunal found, referencing High Court decisions in *Batagol v Commissioner of Taxation* and *Commissioner of Taxation v Ryan*, that an assessment requires the ascertainment of a specific amount of tax due and payable. Consequently, the Tribunal concluded that a nil assessment, representing zero income and zero tax payable, does not qualify as an assessment for the purposes of the Act.

The Tribunal was satisfied that the objection decisions, or purported objection decisions, which disclosed a nil assessment for the years under review were not reviewable. Accordingly, the application for review was dismissed under section 42A(4) of the *Administrative Appeals Tribunal Act 1975* (Cth).