Taxabull » Symone

ATO vs Symone Anstis case dispute continues..!!

taxabull — Sun, 20 Dec 2009 23:24:15 +0000

Justice will be served..!!

http://www.flickr.com/photos/mrbill/ / CC BY 2.0

This is our continued coverage of this tax case regarding the deductibility of self-education expenses against Youth Allowance income……

The full Federal Court found in favour of Symone Anstis on 4 November 2009.

However, the ATO has once again lodged an application on 2 December 2009 for special leave to appeal against this decision to the High Court.

This should be final rung in the ongoing dispute, so until then, the ATO’s existing non-deductible view stands.

Keep those tax receipts though as we think that Symone has a very strong case to argue.

TIMELINE OF EVENTS (UPDATED)

17/11/2006 ATO issues an amended tax assessment to Symone

27/11/2006 Symone objects to amendment

05/12/2006 ATO disallows Symone’s objection

12/12/2006 Symone goes to Tribunal to dispute ATO decision

18/04/2007 Tribunal rules in favour of ATO

21/07/2008 Symone appeals to the Federal Court

01/04/2009 The Federal Court rules in favour of Symone

29/05/2009 The ATO appeals against the Federal Court decision

04/11/2009 The full Federal Court dismisses the ATO’s appeal

02/12/2009 The ATO appeals the decision to the High Court

COURT JUDGEMENTS

Symone Anstis and Commissioner of Taxation – AAT (18 April 2007)

Anstis v Federal Commissioner of Taxation – Federal Court (1 April 2009)

FC of T v Anstis – Full Federal Court (4 November 2009)

Fingers crossed…!

Taxabull Team

Its official!! The results are out for Federal Commissioner of Taxation vs Symone Antis!!

taxabull — Tue, 17 Nov 2009 21:21:03 +0000

We have been covering this tax case with interest from Day One….

FINAL CONCLUSION

The Symone Antis v. FC of T case confirms that education expenses should be allowaed as deductions against Youth Allowance income.

This is a massive win for tertiary students around Australia earning Youth Allowance income!!

From a revenue perspective, the court ruled that Youth Allowance is assessable income as per s 6.5. It doesn’t fall under educational scholarships which is exempt income as per s 6-20.

In fact, it is specifically mentioned in s 51-35 that,

“‘The following payments made to or on behalf of a full time student at a school, college or university are not exempt from income tax under item 2.1A of the table in section 51 10:”

The court also ruled that “the expenditure in question was incurred in the course of gaining or producing the respondent’s assessable income within the first limb of s 8-1″.

It is amazing that the Commissioner was pursuing the case so vigourously considering the facts of the case. Perhaps it is indicative of the overall aggressive tact taken recently by the ATO.

Here’s a quick recap for those who are new to this case…

SUMMARY FOR THOSE WHO MISSED THE CASE RULING

SYMONE’S CASE

Symone (the taxpayer) is claiming that her education expenses should be tax deductible because being enrolled in a tertiary education is one of the prerequisites for her entitlement to Youth Allowance.

So, she claimed various expenses such as textbooks, depreciation on the computer, travel, etc.

COMMISSIONER’S CASE

The ATO claimed that this was bogus because she incurred these education expenses to finish her teaching degree and eventually qualify as a teacher.

They are arguing that the expenses are not deductible because it wasn’t incurred to derive an income. That is, she was not earning money as a teacher yet at this point in time.

They also rejected the argument that the education expenses was a valid deduction to get Youth Allowance income.

TIMELINE OF EVENTS

17/11/2006 ATO issues an amended tax assessment to Symone

27/11/2006 Symone objects to amendment

05/12/2006 ATO disallows Symone’s objection

12/12/2006 Symone goes to Tribunal to dispute ATO decision

18/04/2007 Tribunal rules in favour of ATO

21/07/2008 Symone appeals to the Federal Court

01/04/2009 The Federal Court rules in favour of Symone

29/05/2009 The ATO appeals against the Federal Court decision

04/11/2009 The full Federal Court dismisses the ATO’s appeal

COURT JUDGEMENTS

Symone Anstis and Commissioner of Taxation – AAT (18 April 2007)

Anstis v Federal Commissioner of Taxation – Federal Court (1 April 2009)

FC of T v Anstis – Full Federal Court (4 November 2009)

Cheers!
Taxabull Team

ATO appeals court tax ruling on deductibility of education expenses vs Youth Allowance income

taxabull — Mon, 08 Jun 2009 02:47:00 +0000

Following our previous coverage on Symone Anstis v. Federal Commissioner of Taxation, the Australian Taxation Office has decided to appeal the Tribunal’s decision.

In other words, until the ATO is defeated once again in court, it will not allow education expenses to be claimed against “Commonwealth education assistance schemes”.

SUMMARY FOR THOSE WHO MISSED THE CASE RULING

SYMONE’S CASE

So, she claimed various expenses such as textbooks, depreciation on the computer, travel, etc.

COMMISSIONER’S CASE

The ATO claimed that this was bogus because she incurred these education expenses to finish her teaching degree and eventually qualify as a teacher.

They are arguing that the expenses are not deductible because it wasn’t incurred to derive an income. That is, she was not earning money as a teacher yet at this point in time.

They also rejected the argument that the education expenses was a valid deduction to get Youth Allowance income.

TIMELINE OF EVENTS

17/11/2006 ATO issues an amended tax assessment to Symone

27/11/2006 Symone objects to amendment

05/12/2006 ATO disallows Symone’s objection

12/12/2006 Symone goes to Tribunal to dispute ATO decision

18/04/2007 Tribunal rules in favour of ATO

21/07/2008 Symone appeals to the Federal Court

01/04/2009 The Federal Court rules in favour of Symone

29/05/2009 The ATO appeals against the Federal Court decision

SUMMARY

We will have to wait and see whether or not the ATO’s appeal will be allowed. If so, then the whole legal circus starts again.

We will update everyone on the progress of this tax case.

In the meantime, the ATO has issued a statement that it will continue to treat education expenses as non-deductible against Youth Allowance (and other government assistance) until a FINAL decision is made.

SPECIAL NOTE FOR LAW STUDENTS OR TAX LAW ENTHUSIASTS (!)

The case judgement is a very useful and straight-forward explanation of basic tax law. That is, the explanation of how revenue recognition and tax deductibility works.

The case judgement can be found here.

From the AusTax team.

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