New Zealand Case Law: Decisions & Judgments

Topic

Input tax deduction

Legal area

Court

1 Oct 2018

CANTERBURY JOCKEY CLUB INCORPORATED v COMMISSIONER OF INLAND REVENUE [2018] NZHC 2569

Citation

[2018] NZHC 2569
Court

High Court

The Rules of Racing impose enforceable, reciprocal obligations and NZTR pays stakes (including GST) on behalf of clubs; trainers and riders therefore supply services to the Club on race day, stakes paid to successful trainers and riders are consideration (there is the necessary nexus/reciprocity), and accordingly the Club is entitled to claim GST input tax deductions for stakes payments to GST-registered trainers and riders.
19 Dec 2008

GLENHARROW HOLDINGS LTD V COMMISSIONER OF INLAND REVENUE SC 59/2007

Citation

GLENHARROW HOLDINGS LTD V COMMISSIONER OF INLAND REVENUE SC 59/2007
Court

Supreme Court

The Supreme Court held that s 76 could be invoked by the Commissioner where, objectively, an arrangement's structure and effect defeat the intent and application of the GST Act; here vendor finance to a near‑capitalless purchaser and the artificial character of the purported full payment produced an inflated input tax refund inconsistent with economic reality, entitling the Commissioner to treat the arrangement as void for GST purposes and to reconstruct refunds to reflect actual economic payments; the appeal was dismissed.
19 Dec 2005

THE COMMISSIONER OF INLAND REVENUE V LUNDY FAMILY TRUST AND BEHEMOTH CORPORATION LIMITED CA CA115/04

Citation

openlaw-ca81e129_2b64_41f8_9a1c_9495224ed2a3.pdf
Court

Court of Appeal

The appeal is allowed in part because the adjustment sought relates only to quantum and is governed by s138P; accordingly inputs for rates, insurance and maintenance may be claimed under s20(3)(a) and (b) and apportioned under s21(1) to allow a 75% input tax refund for each supply for GST periods April 1998 to June 2000; costs awarded to respondents.
10 Nov 2005

THE COMMISSIONER OF INLAND REVENUE V LUNDY FAMILY TRUST AND ANOR CA CA115/04

Citation

openlaw-f54c7717_9008_40bb_a438_2492c6cabd81.pdf
Court

Court of Appeal

s 21(1) adjustments are to be based on the acquisition cost (or lower market value) of the property including land and buildings; depreciation is a principled method to apportion that acquisition cost across GST periods; periodic adjustments are permissible; s 21(5) allows recovery on return to taxable use regardless of whether the earlier adjustment was periodic or one-off; ongoing service costs are conceptually separate and require apportionment (Court suggested a 75/25 taxable:exempt split as a starting point and sought further submissions).

New Zealand Case Law

CANTERBURY JOCKEY CLUB INCORPORATED v COMMISSIONER OF INLAND REVENUE [2018] NZHC 2569

GLENHARROW HOLDINGS LTD V COMMISSIONER OF INLAND REVENUE SC 59/2007

THE COMMISSIONER OF INLAND REVENUE V LUNDY FAMILY TRUST AND BEHEMOTH CORPORATION LIMITED CA CA115/04

THE COMMISSIONER OF INLAND REVENUE V LUNDY FAMILY TRUST AND ANOR CA CA115/04