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  • Private ruling by the Commissioner of Taxation

    A private ruling is a written expression of opinion by the Commissioner of Taxation (the Commissioner) about the way in which tax laws and other specified laws administered by the Commissioner would apply to, or be administered in relation to, an entity in relation to a specified scheme.

    An application for a private ruling must be made in the approved form and in accordance with Divisions 357 and 359 of Schedule 1 to the Taxation Administration Act 1953 (TAA).

    The required information and documentation that accompany a private ruling request must be sufficient for the Commissioner to make a private ruling and include:

    • the entity to whom the ruling is to apply
    • the facts describing the relevant scheme or circumstance
    • relevant supporting documents such as transaction documents
    • issues and questions raised relate to the relevant provision to which the ruling relates
    • your arguments and references on such questions.

    The Commissioner may request additional information to make a ruling. The Commissioner will then consider the request and either issue or, in certain limited circumstances, refuse to issue a private ruling.

    Publication

    To improve the integrity of the private rulings system, we publish a version of every private ruling on the ATO Legal database.

    Before we publish, we edit the ruling to remove all identifying details, to ensure that taxpayer privacy is maintained.

    A copy of the edited version of the ruling that we plan to publish is included with the ruling. Applicants who are concerned that the edited version may still allow them to be identified have 28 days to contact us to discuss these concerns.  

    For more information, see PS LA 2008/4 Publication of edited versions of written binding advice.

    Review rights

    Generally, taxpayers can object to adverse private rulings or a failure to make a private ruling in much the same way that they can object to assessments. They can refer to a review of adverse objection decisions on a private ruling by the Administrative Appeals Tribunal (AAT) or a court. An explanation of review rights and how to exercise them is issued with the private ruling.

    A taxpayer cannot object to a private ruling if there is an assessment for the taxpayer for the same income year to which the ruling relates. If this is the case, the taxpayer can only object to the assessment.

    Where a taxpayer has objected to a private ruling, the taxpayer cannot object to a later assessment about the same matter ruled on, unless the assessment relates to facts that are materially different from those dealt with in the private ruling, or deals with the application of tax law provisions not dealt with in the private ruling (for example, the application of Part IVA of the ITAA 1936).

    For more information on how to object to private rulings and assessments, including the time limits within which those objections have to be made, see Dispute or object to an ATO decision.

    When rulings are binding

    A private ruling is binding on the Commissioner where it applies to an entity and the entity has relied on the ruling by acting (or omitting to act) in accordance with the private ruling. A private ruling only applies to the particular scheme or circumstance that it describes. If there is a material difference between the scheme described and what actually occurs, the private ruling does not apply.

    An entity can stop relying on a private ruling at any time (unless prevented by a time limit imposed by a taxation law) by acting (or omitting to act) in a way that is not in accordance with the private ruling, and can subsequently resume relying on the private ruling by acting accordingly. The Commissioner cannot withdraw a private ruling. However, where the scheme to which a private ruling relates has not begun to be carried out and where the private ruling relates to an income year or other accounting period, and that period has not begun, the Commissioner can make a revised private ruling.

    Last modified: 08 Feb 2019QC 55259