Birchstone Brief for the week ended 12 January 2024

ATO Updates

ATO now administering additional DGR categories

Following amendments made by the Treasury Laws Amendment (Refining and Improving Our Tax System) Act 2023 (Cth), the Commissioner has from 1 January 2024 begun administering the deductible gift recipient (DGR) categories for environmental organisations, harm prevention charities, cultural organisations and developing country relief funds or organisations.

Class rulings issued

The ATO has issued:

  • CR 2024/1 – AFL Players’ Association Limited – Education and Training Grant Program; and
  • CR 2024/2 – Geotab Australia Pty Ltd – Electronic car logbook and odometer record-keeping system.



Copley v FCT [2024] AATA 8 – Deductions for car and other work-related expenses denied

The AAT has upheld the Commissioner’s objection decision to deny a taxpayer deductions for their car and other work-related expenses, on the basis that the taxpayer failed to meet the substantiation requirements. This decision serves as a reminder of the need for adequate supporting documentation to substantiate claims for work-related deductions.

Gazal v DFCT [2024] NSWSC 1 – Taxpayer subject to $18 million tax debt fails to have DPO set aside

A taxpayer liable to pay an $18 million tax debt pursuant to a Deed of Settlement with the Commissioner has failed in his bid to have the NSW Supreme Court set aside a departure prohibition order (DPO) that was issued by the Commissioner on 11 December 2023. The DPO was issued after the Commissioner discovered that almost $6.5 million had been dissipated from bank accounts controlled by the taxpayer which were subject to freezing orders. Siding with the Commissioner, the Court:

  • rejected the taxpayer’s claims that the DPO had been issued for improper purposes;
  • held that the Commissioner had had reasonable grounds to believe it was desirable to issue a DPO to the taxpayer to ensure he did not depart Australia for a foreign country without wholly discharging his tax liability or making satisfactory arrangements to see it wholly discharged; and
  • therefore concluded that the DPO had been validly issued pursuant to s 14S of the TAA 1953, and should consequently be upheld.

Fidge v FCT [2023] AATA 4245 – AAT confirms Army colonel’s position was genuinely redundant

The AAT has set aside an objection decision made by the Commissioner, holding that a full-time army colonel of the Permanent Forces who was involuntarily transferred to the Army Reserves was entitled to concessional income tax treatment in relation to an associated ‘special benefit payment’ he had received, on the basis that the payment constituted a ‘genuine redundancy payment’ within the meaning of section 83-175(1) of the ITAA 1997. This was because the AAT found that the taxpayer was transferred because his full-time position with the Permanent Forces was no longer required and excess to the Army’s requirements, and therefore genuinely redundant.



To our knowledge, the Commissioner has not lodged an appeal against the AAT decision in Bowerman v FCT [2023] AATA 3547 (covered in the Birchstone Brief for the week ended 3 November 2023). As such, it would appear that the Tribunal’s decision in that case stands. In that case, the AAT allowed a self-funded retiree who managed her own investment portfolio (which included rental property investments) a tax deduction for the loss she incurred on the sale of a residential unit that she had originally purchased with a profit-making purpose, despite the fact that she had also temporarily lived in the relevant property as her primary residence before selling it.

HNMF (Scrap Gold Case)

The Commissioner has lodged a notice of appeal to the Federal Court against the AAT’s decision in HNMF v FCT [2023] AATA 4067. In that case, the AAT held that the general anti-avoidance provisions of the GST Act did not apply to a “scheme” which resulted in a refiner of scrap gold obtaining input tax credits.


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