"Parliament having prescribed the circumstances which will attract tax, or provide occasion for its reduction or elimination, the citizen has every right to mold the transaction into which he is about to enter into a form which satisfies the requirements of the statute...[It cannot] matter that *his choice of transaction was influenced wholly or in part by its effect upon his obligation to pay tax."

  High Court of Australia       

       Judicial Notice of Chief Justice Sir Garfield Barwick
 

         Your Choice Options

        *Consider the four options or his choices  all patriotic Australian people have on Income Tax:

  Not pay Tax or:
  Pay Tax and/or:
  Create the Wealth of our Nation and/or:
  A bit of all Three.
 

      The Duty of Care

        (Judicial Notice - Supreme Court of N.S.W.)

           ----- "an accountant or solicitor who fails to give any consideration to lawful tax minimization structures which reasonably should be known or discoverable at the time a matter is current would, prima facie, be professionally negligent, unless there is an express disclaimer (which should be confirmed in writing) that no advice on revenue aspects, including stamp duty is proffered. Indeed, an accountant or solicitor should also consider the tax position of others who might reasonably be foreseen to be affected (e.g. Beneficiaries of a trust or shareholders in a company), as a duty of care may be owed to them".

        Justice Cohen,                              

        Bayer v Balkin (95 ATC 4609)

   "NECESSARY" TAX DEDUCTIONS:                   

        What is "necessary" to the High Court of Australia on Tax Deductions.
     (within the Australian Federal Constitution?)
 

     A High Court of Australia case summation extract: ".... within the limits of reasonable human conduct, the man who is carrying on the business must be the judge of what is "necessary"."

     NB. "the man who is carrying on the business must be the judge"

    HIGH COST:
    The use of an accountant, solicitor (or the wise man holding up the bar in your favourite pub) to gain an opinion on "necessary" is not binding on the Australian Tax Office - nor on you. 

    The wise man, on the other hand might only cost you a beer and he may not be so demanding or pontifical.

        FIRST LIMB:
        All Tax Payers are allowed tax deductions under the first limb of the Section of the Act for all Working Class losses and outgoings incurred in producing Assessable Income. These are indicated at Items D1 to D9 in the Individual Tax Return of the ATO TaxPack 1998.

      SECOND LIMB:
     The second limb applies only to losses and outgoings "necessarily" incurred in carrying on a Business for the purpose of gaining or producing such income and these are located at Items D10 to D14 in the TaxPack Supplement Individual Tax return for Business Class.

    PARTNERSHIP LOSSES or Profits:
    Other Small Family Business Tax Deductions are incorporated in the Partnership Tax Return and each Partner records this situation in his/her Supplementary Tax Return at Item 10.

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        Qualified Tax Planning Instructors (TPI) with Dip T. Ed. and DEET Certification provide instruction. 

     "Express Disclaimer"

         Most Solicitors, Financial Advisers and Accountants are employees and are not allowed by their employers or principals, to give advice on tax matters - and so indicate their "express disclaimer" in writing (er - sometimes). The ATO s251M Negligence Clause also causes them concern as they can be fined by the ATO and sued in a Common Law Claim by the Tax Payer badly advised.

 Part IVA anti-Avoidance Legislation:

       "arrangements of a normal business or family kind, including those of a TaxPlanning nature" would be beyond its scope.

       "is designed to operate against "blantant, artificial, or contrived arrangements, but not cast unnecessary inhibitions on normal commercial transactions by which taxpayers legitimately take advantages of opportunities available for the arrangement of their affairs"

       NB. A person who, by fair means or foul, contrives to relieve another person of his "Freedom of Choice" to act and that person suffers a financial loss or disadvantage, the person responsible for that loss of Freedom may be deemed to have acted negligently in his "Duty of Care" ------ it may be that a case in Common Law exists to reclaim that loss.

       Workers' Union Officials:

          All Union Officials are critical of the rich man's ability to TaxPlan to excite the poor workers. Thus most Government Employees (including teachers) are reluctant to go against the Union rules - even though Tax Planning is a Freedom of Choice and a Right guaranteed by our Australian Federal Constitution and the High Court of Australia.

          But all Government Employees -- and Unions --have a "duty of care".

          The Freedom of Choice is not on the agenda of the Unions - for their members - and not likely to be in the foreseeable future. Freedom of Choice is not a choice for Servants - Public or Private.

          Some Poor Peoples' Verdict:
       "The rich should be made to pay more tax so we can have more income on welfare".

          Some Rich Peoples' Verdict:
        "So! Move the factory offshore where the workers are more patriotic and more willing to work".

    FREE at the ATO
    The correct approach (on any question in tax matters of a questionable nature or not answered in the ATO TaxPack or the Tax Bible is to obtain a free (almost) Private Ruling from the ATO which is, more or less, binding. --- see Tax Commissioner's Personal Guarantee.

  NB.

  For Information on Taxation don't hesitate to check with the Australian Taxation Office Web Site:

       www.taxreform.ato.gov.au

       infoline Ph 13 61 40