Part IVA

Litigation trends have been a topic of significant interest in recent times. Part IVA of the Income Tax Assessment Act 1936 (ITAA 1936) applies where a taxpayer gets a tax benefit in connection with a scheme entered into for the sole or dominant purpose of obtaining a tax benefit. Since 1 July 2008, there have been 17 court decisions on anti avoidance issues, 10 of which have been favourable to the taxpayer and the remaining 7 favourable to the ATO.

After the August 2011 decision of the Full Federal Court, RCI Pty Ltd v. Federal Commissioner of Taxation [2011] FCAFC 104; 2011 ATC 20-275 (RCI 2011), the then Assistant Treasurer announced on 1 March 2012 that the Government will introduce legislation in the spring sittings of Parliament to address the issues that arose in that case concerning the operation of Part IVA of the ITAA 1936.

    Last modified: 15 Feb 2013QC 26462