By Justice Richard Edmonds*
Through the prism of the High Court’s decision in Spriggs & Riddell, his Honour undertakes a survey of the cases relevant to the criteria that need to be satisfied before a court finds that a business is being carried on, or whether a transaction is in the ordinary course of carrying on business, including profit motive; scale of activities; commercial character of the transaction; system and organisation; species of taxpayer; the temporal context; commitment or whether the activities are provisional only, as well as related issues such as the vehicle used and the scope and nature of the business. Finally, his Honour looks at the tax consequences of such a finding for both outgoings and losses as well as receipts and receivables.
The full article can be accessed here: “A finding that a taxpayer carries on a business: What is required, related issues and what are the tax consequences?” (2010) 39 AT Rev 71.
*Federal Court of Australia.