Macpherson Kelley client finds success in Court after 10 year tax dispute
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Macpherson Kelley’s Taxation team is celebrating a long-awaited decision for their client, Mr Lin Jum Cheung, following a tax dispute with the ATO lasting over 10 years. The impact of the decision is underpinned by the commentary from The Honourable Justice John Logan, who ruled in favour of Mr Cheung, confirming that the deposits made to Mr Cheung from his sister in Vanuatu were “not income in any sense”.
Macpherson Kelley Principal Lawyer Dominic Moon and Special Counsel Elizabeth Allen instructed Justin Byrne and Mark Robertson KC who argued on behalf of Mr Cheung in the Federal Court of Australia.
Mr Cheung was the recipient of just shy of $33 million in deposits over 10 years from Vanuatu. On the basis of a partially successful objection decision, this amount was less than half of the originally assessed amount raised as default assessments in 2018 (following a lengthy review and audit). The outcome of the objection decision was to tax Mr Cheung on those deposits as his income.
After a lengthy objection process, COVID delays and multiple attempts at pre-trial settlement, the Federal Court ultimately found in Mr Cheung’s favour – granting his appeal in full.
Dominic Moon said that the matter was predominantly a facts case. Still, the decision holds important lessons for payments made within a family context.
Justice Logan emphasised the importance in taxation administration of “open-mindedness and detachment from assessment in decision-making in respect of objections”, rather than an “uncritical rehearsal of cases divorced from an understanding of a family reality and a related absence, save for interest, of an income tax liability.”
This protracted tax dispute has come with significant cost and stress to the client, even going so far as impacting his personal movements to and from Australia by virtue of an accompanying departure prohibition order.
“For a close-knit family, with elderly relatives overseas, the impacts of the ATO’s punitive approach to an elderly taxpayer, who is wholly exonerated in this decision, cannot be overstated,” said Elizabeth Allen.
The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.
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Macpherson Kelley client finds success in Court after 10 year tax dispute
Macpherson Kelley’s Taxation team is celebrating a long-awaited decision for their client, Mr Lin Jum Cheung, following a tax dispute with the ATO lasting over 10 years. The impact of the decision is underpinned by the commentary from The Honourable Justice John Logan, who ruled in favour of Mr Cheung, confirming that the deposits made to Mr Cheung from his sister in Vanuatu were “not income in any sense”.
Macpherson Kelley Principal Lawyer Dominic Moon and Special Counsel Elizabeth Allen instructed Justin Byrne and Mark Robertson KC who argued on behalf of Mr Cheung in the Federal Court of Australia.
Mr Cheung was the recipient of just shy of $33 million in deposits over 10 years from Vanuatu. On the basis of a partially successful objection decision, this amount was less than half of the originally assessed amount raised as default assessments in 2018 (following a lengthy review and audit). The outcome of the objection decision was to tax Mr Cheung on those deposits as his income.
After a lengthy objection process, COVID delays and multiple attempts at pre-trial settlement, the Federal Court ultimately found in Mr Cheung’s favour – granting his appeal in full.
Dominic Moon said that the matter was predominantly a facts case. Still, the decision holds important lessons for payments made within a family context.
Justice Logan emphasised the importance in taxation administration of “open-mindedness and detachment from assessment in decision-making in respect of objections”, rather than an “uncritical rehearsal of cases divorced from an understanding of a family reality and a related absence, save for interest, of an income tax liability.”
This protracted tax dispute has come with significant cost and stress to the client, even going so far as impacting his personal movements to and from Australia by virtue of an accompanying departure prohibition order.
“For a close-knit family, with elderly relatives overseas, the impacts of the ATO’s punitive approach to an elderly taxpayer, who is wholly exonerated in this decision, cannot be overstated,” said Elizabeth Allen.