Commissioner of Taxation v Malouf [2009] FCAFC 44

Commissioner of Taxation v Malouf [2009] FCAFC 44

The liability to pay the residue under the contract for purchase of land and development was not incurred at the time of entering the contract, as it depended upon settlement and delivery of transfer; thus, the outgoing was not incurred in the 1999 year of income and was not deductible in that year.

Jurisdiction
Australia
Judgment Date
02 April 2009
Procedural Posture
Appeal / Final Judgment (full Court)
Outcome
Appeal allowed; primary judge's orders set aside, Commissioner's disallowance of objection confirmed (save as to penalties); further orders to be filed by parties.
Legal Topics
['income Tax' 'deductions' 'timing of Incurring Outgoing' 'executory Contracts' 'deductibility Under Income Tax Assessment Act']
['taxation'] ['income Tax' 'deductions' 'timing of Incurring Outgoing' 'executory Contracts' 'deductibility Under Income Tax Assessment Act']

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Procedural Posture

Appeal / Final Judgment (full Court)

Legal Issues

  1. 1 ['Whether obligation to pay residue under land purchase contract was an outgoing incurred at time of entering contract and deductible in the relevant income year']

Ratio Decidendi

The liability to pay the residue under the contract for purchase of land and development was not incurred at the time of entering the contract, as it depended upon settlement and delivery of transfer; thus, the outgoing was not incurred in the 1999 year of income and was not deductible in that year.

Court Disposition

Appeal allowed; primary judge's orders set aside, Commissioner's disallowance of objection confirmed (save as to penalties); further orders to be filed by parties.

Orders

  • ['Appeal allowed' 'Orders of primary judge made on 22 April 2008 be set aside' "Decision of appellant dated 21 July 2006 disallowing respondent's objection made on 4 March 2005 against the notices of amended assessment and penalty for tax shortfall issued on 21 October 2004 for the year of income ended 30 June 2000...