Appeals update – week ending 10 February 2012

• The High Court has granted special leave for the Commissioner to appeal against the decision in Qantas Airways Limited v Commissioner of Taxation [2011] FCAFC 113. The Full Federal Court found that no GST was payable on domestic airfares where the passenger paid the fare, but either cancelled the reservation or did not show up for the flight, and no refund was available or claimed 
• The High Court has refused special leave for the Commissioner to appeal against the decision in RCI Pty Ltd v FCT [2011] FCAFC 104. The Full Federal Court found that no tax benefit was obtained in connection with a scheme so Part IVA of the Income Tax Assessment Act 1936 did not apply. Broadly, the matter concerned a dividend payment which reduced RCI’s (a member of the James Hardie Industries Limited Group of companies) capital gain on the later disposal of the shares in a US company as part of an international corporate reorganisation
• The High Court has refused special leave for the taxpayer to appeal against the decision Russell v Commissioner of Taxation [2011] FCAFC 10. The Full Federal Court held that amounts paid by an Australian company to a New Zealand company owned by the taxpayer in respect of the services rendered by him comprised his 'personal services income' (PSI) and were therefore to be included in his assessable income according to Part 2-42 of the Income Tax Assessment Act 1997 (ITAA 1997).

Article last updated 13 February 2012