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Technical tax area Ngā tūmomo whakataunga me ngā aratohu

List of cases

In this section you will find brief notes of decisions made by the Taxation Review Authority, the High Court, Court of Appeal, Privy Council and the Supreme Court. These case notes do not set out Inland Revenue policy, nor do they represent our attitude to the decision.

Title Decision date Case Appeal status

The Commissioner obtains interim charging order and mareva injunction over trust assets

11 October 2007

The Commissioner of Inland Revenue v Joseph Colin Skudder, Willerton Investments Limited, Athena Professional Trustees Limited

The Commissioner obtained an interim mareva injunction and pre-judgment charging orders over assets held by a corporate trustee, which were prima facie beneficially owned by the taxpayer. Not appealed.

Court of Appeal upholds TRA's tax avoidance findings for property development

25 June 2007

Ch'elle Properties (NZ) Limited v The Commissioner of Inland Revenue

An arrangement in terms of whether there were gaps of up to 20 years between the right to claim input tax and the liability for output tax was held to be tax avoidance. Appealed.

Unsuccessful appeal from the Commissioner of Inland Revenue's strike-out application

18 June 2007

Ron West Motors (Otahuhu) Limited v The Commissioner of Inland Revenue

An unsuccessful attempt by the taxpayer to force The Commissioner of Inland Revenue to accept a late objection. The Commissioner declined to accept the late objections (and thus did not allow them) on the basis he had no power to re-assess in the relevant years anyway as those years had been determined by the Courts. Appealed.

Trustee liable for post bankruptcy tax debt

13 June 2007

The Commissioner of Inland Revenue v Philip John Duncan

A Trustee may not after being bankrupted, continue to trade and incur debts with impunity from liability for GST. If he chooses to do so he incurs a fresh liability that is not provable in his bankrupt estate. Appealed.

Trinity litigants lose appeal based on Trinity settlements

11 June 2007

Accent Management Ltd, Ben Nevis Forestry Ventures Ltd, Bristol Forestry Ventures Ltd, Clive Bradbury, Greenmass Ltd, Gregory Peebles, Kenneth Laird Estate, Lexington Resources Ltd and Redcliffe Forestry Ventures Ltd v The Commissioner of Inland Revenue

The Court of Appeal dismissed the appeal and upheld the High Court's refusal to recall the judgment. Appealed.

Trinity investors lose appeal

11 June 2007

Accent Management Ltd, Ben Nevis Forestry Ventures Ltd, Bristol Forestry Ventures Ltd, Clive Bradbury, Greenmass Ltd, Gregory Peebles, Kenneth Laird Estate, Lexington Resources Ltd, and Redcliffe Forestry Ventures Ltd v The Commissioner of Inland Revenue

The Court of Appeal has dismissed the taxpayers appeal and upheld the finding that the Trinity Forestry arrangement is a tax avoidance scheme. Appealed.

Service of Notice of Response sent to incorrect address sufficient

08 June 2007

The Commissioner of Inland Revenue v LGH Thompson

This was an appeal against the decision of a Taxation Review Authority, AAP Willy, in which he held the taxpayer was entitled to deregister for GST purposes. Appealed.

Breach of solicitor's undertaking to the Commissioner

26 April 2007

Manu Chhotubhai Bhanabhai & Ors v The Commissioner of Inland Revenue

The Supreme Court refused leave to appeal the Court of Appeal's Judgment holding that the solicitor had breached the undertaking given to the Commissioner. The Court of Appeal did not make an error in principle. Appealed.

Bill of Rights

03 April 2007

Peter Lloyd Machirus v The Commissioner of Inland Revenue

The High Court dismissed the taxpayer's appeal and upheld the assessments and found there was no breach of the Bill of Rights Act. He further upheld the Commissioner's cross-appeal and held that the Taxation Review Authority erred in finding certain assessments statute-barred. Appealed.

Waiver in terms of Section 24(6)(b) of the GST Act

28 February 2007

Decision Number 4/2007

When requested to waive the requirement for a tax invoice under section 24(6)(b) of the GST Act the Commissioner must apply the two limbs of the test at the time he makes his determination. A waiver under section 24(6) cannot operate retrospectively. Not appealed.

Timing of deduction for accounting services

23 November 2007

TRA Decision Number 14/07

The taxpayer is allowed a deduction in the income tax year which the expenditure is incurred. Expenditure is incurred when the taxpayer is definitively committed to the expenditure, a legal obligation to make payment in the future has accrued, the expenditure must be more than impending, threatened or expected and theoretical contingencies can be disregarded. The taxpayer did not incur the expenditure (accounting fees for the 2003 financial statements and returns of income) until 2004 and accordingly, could only deduct those fees in 2004 - not 2003 as claimed. Not appealed.

Taxpayers loses costs application

30 August 2007

K & W Wynyard & Fox Trust v The Commissioner of Inland Revenue

The taxpayer was unsuccessful is seeking indemnity or increased costs from the Commissioner. Not appealed.

Taxpayer loses procedural point

31 July 2007

Decision 11/2007

The calculation of the time frame for filing a case stated with the TRA commences when a points of objection notice is received by the Director Litigation Management Unit and not by its receipt by the wider Inland Revenue Department. Not appealed.

Taxpayer fails in abuse of process claim

04 July 2007

Sandra Hineato Anderson v The Commissioner of Inland Revenue

The taxpayer claimed that the Commissioner has assessed her as being liable for shortfall penalties for tax evasion due to the fact that an Inland Revenue officer had given her incorrect advice as to how to complete ten GST returns and a business cessation form. The Court found that no such advice was given and the claim of abuse of process had not been made out. Furthermore, the allegation that the Commissioner failed to follow due process in investigating his own role in relation to the completion of the GST forms and business cessation form had not been proved. Not appealed.

TRA's alternative assessment upheld

30 July 2007

Max Beckham v The Commissioner of Inland Revenue

The TRA upheld the taxpayer's challenge to the Commissioner's assessment but then assessed an alternative ground. The High Court dismissed the taxpayer's appeal against the TRA's decision. Not appealed.

Special leave to appeal

30 August 2007

Peter Lloyd Machirus v The Commissioner of Inland Revenue

The taxpayer was late to file the appeal due to the fact that he initially did not pay the filing fee and later the appeal was not in the prescribed form.The Commissioner opposed the special leave application to file out of time. Appealed.

Share transactions not taxable

31 October 2007

Dowell & Ors as trustee for Estate Frank King, Brenda King & Ann King v The Commissioner of Inland Revenue

Taxpayers' share trading activities held to be on capital account. Appealed.

List of names must be provided

17 October 2007

The Commissioner of Inland Revenue v Blakeley

Non-disclosure right did not apply to a list of names and that list must be provided to the Commissioner under section 17 of the TAA. Not appealed.

GST Tax Avoidance

06 September 2007

Ch'elle Properties (NZ) Limited v The Commissioner of Inland Revenue

The taxpayer had claimed GST input tax credits on a total of 117 property transactions. Payment to the vendor was by way of a small deposit with the remainder payable on settlement. The difference in registration types (payment and invoice) between the parties saw the taxpayer claiming an input credit on the entire purchase price whilst the vendor only paid output tax on the deposit paid. The Commissioner considered the arrangement was set up for the tax advantages it could obtain and alleged tax avoidance under section 76 of the GST Act. The TRA, High Court and Court of Appeal all agreed with the Commissioner. Appealed.

Filing challenge out of time (Appeal)

31 August 2007

Amaltal Fishing Co Ltd v The Commissioner of Inland Revenue

The taxpayer appealed the decision of the Authority which declined to grant leave to commence proceedings out of time, on the basis that no exceptional circumstances existed. Appealed.

Disputant's Claim Struck Out

30 August 2007

Decision Number 13/2007

Part VIII of the Tax Administration Act 1994 ("TAA"), the objections procedure, applies to assessments issued after 1 April 1995 and before 1 October 1996. The TRA has no jurisdiction to award costs or damages. Not appealed.

Commissioner's decision to refuse a late NOPA review

21 February 2007

Diana Balich v The Commissioner of Inland Revenue

The High Court found the Commissioner had made a reviewable error in the process by which he reached his decision not to accept a late notice of proposed adjustment under section 89K. However, the High Court declined to grant relief to the taxpayer due to the futility of her underlying arguments. Not appealed.

Application for leave to commence proceedings after expiry of response period dismissed

02 March 2007

Decision Number 5/2007

The applicant sought leave from the Authority to commence proceedings out of time, on the grounds exceptional circumstances applied. The Authority decided that no exceptional circumstances existed and dismissed the application. Not appealed.

Appealing Strike Out of Judicial Review Application

18 July 2007

Ch'elle Properties (NZ) Limited v The Commissioner of Inland Revenue

The taxpayer appealed the High Court decision to strike out its application for judicial review of the Commissioner's actions. The allegations against the Commissioner included illegality in withholding refunds; retrieving refunds accidentally paid; negligence; breach of statutory duty and not complying with the Bill of Rights Act. Appealed.

Appeal against dismissal of Strike-out Application

13 December 2007

The Commissioner of Inland Revenue v J A Reid & Ors

The plaintiff alleged misfeasance in public office against the Commissioner in relation to the tax investigation and SFO referral of the plaintiff's investment scheme. The Commissioner's application to strike out the proceedings was denied by the High Court. He appealed to the Court of Appeal. Appealed.

 

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Note: We are currently converting historical case notes into HTML format. If you are looking for case notes that are not published here you may find them by referring to the Tax Information Bulletin.