On 9 May 2022, the Australian Federal Court (Thawley J) handed down judgment in Landcom v Commissioner of Taxation [2022] FCA 510.
His Honour ruled in favor of the taxpayer, a New South Wales state government entity, in relation to both of the key issues in dispute. In summary, and contrary to the arguments of the Commissioner, his Honor decided that:
- The Federal Court has jurisdiction to hear the taxpayer’s Part IVC appeal against an unfavorable goods and services tax (GST) private ruling issued by the Commissioner about a “notional” GST matter (the jurisdictional issue); and
- In the context of the taxpayer’s sale of freehold interests in land to a developer, the relevant GST margin scheme rules which apply to work out the “margin” and the notional GST amount payable have, as their focus, the sale of the individually titled lots, regardless of the lots being sold as a parcel to the developer under a single contract (the Division 75 GST issue).
Source Deloitte
