EMH IV Pty Ltd as trustee for the EMH IV Family Trust v Commissioner of Taxation [2025] FCA 1429

1. A foundational plank of EMH's case was that it lodged the 2015 Return in accordance with the timeframes prescribed by the Commissioner in the TALP, such that any liability to pay income tax (and GIC) could only arise 21 days after receipt of the Assessment Notice on 20 May 2020. To test the strength of that proposition, it is necessary to dissect the terms of the TALP.
2. In so doing, it must be kept steadily in mind that the TALP is an instrument which is, plainly, not the product of a legislative draftsman. It is a working document issued by the ATO in order to inform tax agents of the dates upon which their clients are required to lodge their returns and other associated matters. By no means is it a paragon of drafting though, of course, that is not surprising (nor is it required). Importantly, in some respects, its provisions are expressed in terms akin to note form, rather than written prose, and it is necessary to construe the document accordingly. It follows that it should be construed bearing in mind that it will not have been drafted with the same care as an Act of Parliament: Day v Harness Racing (NSW) [2014] NSWCA 423; (2014) 88 NSWLR 594, 610 [79] - [81]; Environment Protection Authority v Orchard Holdings (NSW) Pty Ltd (in liq) [2014] NSWCA 149; (2014) 86 NSWLR 499, 508 - 509 [44] - [45]. Indeed, as the learned authors of Interpretation (3rd ed, 2024, Thomson Reuters) explain (at 383 [14.40]):

In such a case, a more liberal approach may be warranted when it comes to, for instance, giving different meanings to the same word or the same meanings to different words, or departing from the ordinary meaning of words if that is necessary to avoid anomalies. Likewise, there may be a greater willingness to correct obvious drafting mistakes. A particular application of this approach may be seen in the willingness to construe subordinate legislation particularly liberally so as to avoid an unreasonable result in favour of a reasonably practicable one: ...

(Citations omitted).

1. On the construction issues that arise vis-à-vis the TALP, the context of the relevantly operative provisions is important. That includes the context of those provisions within the document as a whole and, it follows, that it is necessary to identify, in some detail, the document itself.
2. In the introductory section of the TALP, the following appears (at page 1):

Abstract:

The Lodgment program 2015-16 details the concessional lodgment due dates provided to registered agents during the 12 months ending 30 June 2016.

The Lodgment program 2015-16 details the concessional lodgment due dates you receive as a registered agent during the 12 months ending 30 June 2016.

• About the Lodgment program 2015-16
• Obligation type
• Tax returns by client type
• Situations where we request lodgment
• Lodgment and payment dates on weekends or public holidays
• Safe harbour

The subject headings adjacent to the bullet points are (hyperlinked) references to the sequential sections of the program.

1. Page 2 is headed "About the Lodgment Program 2015-16". The "Abstract" to such reads:

The Lodgment program [i.e., the TALP] details the concessional lodgment due dates provided to registered agents. Dates are arranged by the type of tax obligation and, for tax returns, by the type of client.

1. In that context, it is sufficiently apparent that the central purpose of the TALP is to identify the dates upon which taxpayers, who are represented by registered tax agents, are required to lodge their return (such dates being referable to the characteristics of the relevant taxpayer or relevant tax obligation).
2. Appearing under the heading, "Tax returns by client type" (at page 27), is the following:

The end dates for lodging tax returns are dependent on the type of client. This section provides a summary of lodgment end dates for the major client types.

1. It is important to acknowledge that this statement adopts the language of "lodgment end dates". That expression is important, and, in the above context, it is plain that it is referring to the date upon which various "major client types" are to lodge their tax return with the Commissioner.

"Lodgment end dates" for individuals and trusts

1. The first subsection that appears under the heading, "Tax returns by client type", is "Individuals and trusts" (the I&T Section) (at pages 28 - 30). That section is especially relevant with respect to the case at hand and two general observations may be made about it. First, it is "organised" by reference to "key dates" that fall within three sub-sections: lodgment end dates; concession for 15 May 2016; payment. Second, the "Abstract" to it provides some valuable context:

Factors that may affect the lodgment end dates for individuals and trusts include their lodgment and compliance history, their income, whether they are new registrants and whether the 5 June concession applies.

1. Again, the reference to "lodgment end dates" is important and can be related to the use of that expression previously in the program. That is, it is sufficiently apparent that it is referring to the date upon which a relevant taxation return is to be lodged. Such understanding is supported by the heading to the first subsection: "Lodgment end dates" (the I&T Lodgment End Dates Subsection). Under that appears the words:

The lodgment end dates for individuals and trusts are detailed in the following table:

1. The table has two columns. The first is headed "Lodgment end date" and the second is headed "Entity description". Under those headings are rows with a date and corresponding description of the characteristics of the entities to which the date applies. The last row of the table provides:

Tax returns for all remaining individuals and trusts not required earlier and not eligible for the 5 June concession (including new registrations).

1. It would seem to be beyond serious argument that the table operated to identify the dates by which the respectively identified group of taxpayers were required to lodge their tax return.
2. That being so, the description of those individuals and trusts permitted to lodge their tax return on [16] May 2016 requires some explication. Read literally, it encompasses those entities that, first, do not possess the characteristics identified in the earlier rows of the table (i.e., those "not required", by the previous rows of the table, to lodge their return on an earlier day) and, second, "are not eligible for the 5 June concession". What is meant by the phrase, "5 June concession", is discussed below (see supra [50]ff); all that is to be noted at this juncture is that the phrasing of the second criteria set out above is important to EMH's case insofar as it suggests that, first, the lodgment end date for an entity which is not "not eligible for the 5 June concession" cannot be [16] May 2016 and, second, some other lodgment end date must apply for such entities.
3. By contrast, the Commissioner's submission was to the effect that the word "not", when used in relation to those taxpayers that were "eligible for the 5 June concession", was but infelicitous language and that [16] May 2016 remained the lodgment end date for them. Though very little was advanced to support that proposition, it is, as the following discussion discloses, probably correct.
4. In this respect, no submission was made by either party relating to the congruency between the reference to taxpayers, "not eligible for the 5 June concession" in the aforementioned table and the fact that the "Abstract" to the I&T Section of the TALP indicated that lodgment end dates may be affected by, inter alia, "whether the 5 June concession applies" (see supra [42]). Prima facie, there exists a supportable construction of the table to the effect that the [16] May 2016 lodgment end date is applicable to those individual and trusts (including new registrants) which are not the subject of other identified lodgment end dates, and which are not eligible for the "5 June concession". In the latter respect, it is possible that the identification of the class of taxpayers entitled to lodge as late as 15 May 2016 has been defined, in part, by reference to the eligibility to the relevant concession. However, for EMH to succeed, it would be necessary for it to establish some other provision of the TALP provided it with an extended date on which to lodge its return. In the absence of such, an individual or trust, eligible for the 5 June concession, would have been required to lodge their return by the standard date of 31 October 2015.
5. Ultimately, in order to assess whether [16] May 2016 was the "lodgment end date" for the 2015 Return, regard must be paid to the terms of the "5 June concession" for individuals and trusts.

Effect and application of the "5 June concession"

1. The next part of the I&T Section is headed, "Concession for 15 May 2016". That "concession" is expressly described as follows (at pages 28 - 29):

We allow lodgment of tax returns past the lodgment due date of 15 May for:

The concession allows these tax returns to be lodged by 5 June without penalty, provided that any payment required is also made by this date.

This is a concessional arrangement to remit the FTL penalty, where lodgment and payment are made by 5 June for tax returns otherwise due by 15 May 2016.

You do not need to apply for a deferral to receive the 5 June concession date - however, you must apply if you need a lodgment deferral beyond 5 June for these clients.

Tax return for entities who were non-taxable or received a credit assessment in the latest year lodged, and are actually non-taxable or receiving a credit assessment in the current year (unless due earlier) - all entities with a lodgment end date of 15 May 2016 except large/medium taxpayers or head companies of consolidated groups.

Tax return for individuals, partnerships and trusts with a lodgment end date of 15 May 2016, provided payment is also made by this date.

Note: This is not a lodgment end date, but a concessional arrangement where penalties will be waived if lodgment and payment are made by this date.

Does the I&T Concession Subsection extend the lodgment end date to [7] June 2016?

1. The language of this section of the TALP (the I&T Concession Subsection) is not pellucid and it is relied on, by EMH, to assert that the date by which it was required to lodge the 2015 Return was [7] June 2016. Such conclusion was said to flow from the language "[w]e allow lodgment of tax returns past the lodgment due date of 15 May ..." and "[t]he concession allows these tax returns to be lodged by 5 June without penalty ...". Nevertheless, when the words used within the I&T Concession Subsection are read in context, a meaning different to that which is asserted by EMH emerges with sufficient clarity; being simply that individuals and trusts will, in certain instances, be entitled to a remission of the Failure to Lodge (FTL) penalty that would otherwise be imposed by reason of their failure to lodge a return on time (Div 286, Sch 1 of the TAA53).
2. The context to the I&T Concession Subsection includes the statement:

This is a concessional arrangement to remit the FTL penalty, where lodgment and payment are made by 5 June for tax returns otherwise due by 15 May 2016.

1. A similar statement is made in the table set out at supra [50] (in the entry that is adjacent to the "Lodgment date" of "5 June 2016"):

Note: This is not a lodgment end date, but a concessional arrangement where penalties will be waived if lodgment and payment are made by this date.

(Emphasis in original).

1. Those statements as to the nature of the concession cannot be overlooked. They contain several important elements. First, and most importantly, the concession is, by its terms, designed to remit an administrative penalty which is imposed, in general terms, where "you [the taxpayer] are required under a taxation law to give a return ... to the Commissioner in the approved form by a particular day" and do not do so: s 286-75(1) of Sch 1 of the TAA53. In that context, the concession created by the I&T Concession Subsection presumes that lodgment of the relevant return has not occurred within time. Indeed, were the concession to extend the lodgment end date for the 2015 Return to [7] June 2016, it is difficult to see how there would ever be any FTL penalty to remit if "lodgment and payment are made by 5 June" (that is, if the conditions for the concession were satisfied). In that sense, the express purpose of the concession would be made redundant. Such understanding appears to be picked up by the unequivocal statement that "5 June 2016" "is not a lodgment end date" (emphasis added). Second, the concession applies to entities whose return is "otherwise due by 15 May 2016", which reinforces the idea that the entities to which the concession applies have that date as their lodgment end date. Indeed, it is entirely consistent with the statements excerpted above to read the I&T Concession Subsection as (a) making no reference to, or alteration of, the lodgment end date for the 2015 Return; and (b) "allow[ing]" taxpayers to lodge their return "by" [7] June 2016 without fear of incurring a penalty (which would otherwise have accrued by virtue of their failure to lodge the return in compliance with the lodgment end date), provided the relevant tax is paid by then.
2. It is also noted that the table in the I&T Concession Subsection does not use, in the header, the phrase "lodgment end date" (cf supra [44]); rather, it identifies "5 June 2016" as the "lodgment date". As has been discussed, the first expression is easily identified as the date on which a tax return is to be lodged. Prima facie, it follows that use of a second - different - expression in the header of the table in the I&T Concession Subsection, might be understood to be an attempt to convey a meaning which is different to "lodgment end date". Indeed, so much is made clear by the express language of the table: "Note: This [5 June 2016] is not a lodgment end date".
3. At this point, it is worth noting that the meaning that has been attributed to the phrase "lodgment end date" in these reasons is supported by reference to that part of the I&T Section which is concerned with "Payment" (at pages 29 - 30). There, reference is made to clients with a "lodgment end date of 15 May 2016" and some consideration is given in relation to the payment of any tax by reference to when the return is actually lodged with the Commissioner.
4. The conclusion that the concession created by the TALP does not otherwise confer an extension of time in which to lodge a return is supported by, inter alia, reference to the entities which might take advantage of it. The table identifies two groups and, with respect to each, a required characteristic is that they have "a lodgment end date of 15 May 2016". That sits comfortably with the notion that all the 5 June concession does is provide a remission of the FTL penalty that would otherwise have accrued if the relevant taxpayer lodges their return by [7] June 2016.
5. Ultimately, it is difficult to regard the concession as effecting anything other than the remission of penalty. To construe it as an extension of time in which to lodge a return would be contrary to the express explanatory statement of what the concession did. It follows that no additional extension of time in which to lodge the 2015 Return was provided for those entities that were entitled to the 5 June concession as per the I&T Concession Subsection of the TALP.
6. It should be acknowledged that this conclusion renders it difficult to know what to make of the reference in the table in the I&T Lodgment End Dates Subsection to entities not "not eligible for the 5 June concession" (supra [44]). As mentioned, upon its face, it appears to contemplate that some other lodgment end date would be assigned to those entities; but that does not occur in the I&T Concession Subsection. Although there might be some inconsistency, to the extent the document can be rendered harmonious and consistent, it is by concluding that the relevant entities were required to lodge their tax returns with the Commissioner by the standard date of 31 October 2015. Of course, if they did not do so and instead lodged the return (and paid any tax) by [7] June 2016, they would be entitled to a remission of the FTL penalty that had accrued.

1. It should not be overlooked that the concept of a concessional date is not one unique to the I&T Section of the TALP. As has been noted, that program "details" various concessional lodgment due dates on the basis of "the type of tax obligation and ... the type of client" (see supra [38]). Whilst much consideration has been afforded to the latter alternative thus far, it is relevant that an obligation with which the former alternative is concerned is "Super lodgment obligations". In a subsection of the same name (the Superannuation Obligation Section), lodgment end dates are established for superannuation providers and employers with superannuation obligations. In a manner similar to the I&T Lodgment End Dates Subsection, a table exists that details the lodgment end dates for an array of superannuation-associated obligations (recall supra [44]).
2. It is instructive to excerpt the last three rows of that table:

Fund tax return not required earlier and not eligible for the 5 June lodgment concession date.

Payment (if required) is also due on this date.

Superannuation guarantee charge statement - quarterly (NAT 9599) form for quarter 3 2015-16 (1 January to 31 March 2016) if required contributions were not made by the due date. The super guarantee charge is not tax deductible.

Tax returns for super funds that were non-taxable or received a refund by latest year lodged and are non-tables or will receive a refund in current year.

Note: This concession is only available to super funds with a lodgment end date of 15 May 2016 - it is not available to large/medium taxpayers or funds with an earlier due date.

1. The "description" of funds adjacent to the "lodgment due date" of "15 May 2016" (i.e., the first operative row of the table) has characteristics similar to those in the table in the I&T Lodgment End Dates Subsection which are accorded a "lodgment end date" of "15 May 2016". First, it excludes taxpayers who have been ascribed some earlier date and, secondly, it excludes funds eligible for the 5 June lodgment concession date. Yet, in the Superannuation Obligation Subsection, there is, in fact, a "5 June 2016" "lodgment due date" for the tax returns of certain superannuation funds (i.e., the third operative row of the table). It is difficult to speculate why the table in the I&T Lodgment End Dates Subsection does not have a 5 June lodgment end date and the Superannuation Obligation Section does. On one view, it may be thought that the I&T Section was intended to adopt the same arrangement as appears in relation to superannuation lodgment obligations. Any force in such view is, however, greatly diminished by the express statement that the concession for trusts and individuals was "not a lodgment end date", but a concession in relation to FTL penalties. That same indication eschews the creation of a new lodgment end date does not appear in relation to the superannuation trusts. More importantly, in the section under consideration, there is no creation of a "5 June 2016" lodgment end date.
2. Although there be some similarities between the two sections, the differences sufficiently show that different outcomes were intended. Indeed, the comparison only tends to reinforce the view that no extension to the lodgment end date was intended in the I&T Section.

1. A submission advanced by EMH was to the effect that the lodgment end date for the 2015 Return must have been [7] June 2016 because the Commissioner had not sought to impose any FTL penalty upon it under the TAA53. More specifically, it was said that if EMH was, in fact, late in lodging the 2015 Return, it was incumbent upon the part of the Commissioner to pursue it for a FTL penalty and, as he had not, it followed that the Commissioner was not satisfied that lodgment of the 2015 Return was out of time. At the hearing of the Application, it was observed that such submission appeared to rest upon unsteady ground: cf Chevron U.S.A., Inc. v Natural Resources Defense Council, Inc., [1984] USSC 140; 467 US 837 (1984); Loper Bright Enterprises v Raimondo, 603 US 369 (2024); Enfield City Corporation v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135, 151 - 156 [40] - [52]: and, in the result, it was abandoned by the applicant.
2. A related point was sought to be made which seemed to be to the effect that where a court has a choice between two constructions - the first involving a lawful exercise of power; the second involving an unlawful exercise of power - the court should favour the former. Self-evidently, so much can be accepted. On this basis, it was said that although the Commissioner had power to identify a time for lodgement of the tax returns by individuals, he had no power to provide a "loose concessionary arrangement" that does not absolve the taxpayer from their duties under the statutory taxation regime. In other words, it appeared to be submitted that the TALP should be read as an extension of time in which to lodge a tax return because, so it was said, the Commissioner had no lawful power to provide a concession with respect to the FTL penalty.
3. With respect, that submission appears to craft a binary choice where none existed. The TALP deliberately extended the lodgment end dates for a number of classes of taxpayers, and there is no doubt about its validity in that sense. By the I&T Concession Subsection, the Commissioner purported to provide a remitter of the FTL penalty. If the concession was invalid - though this was not the subject of any detailed submissions and no conclusion can be made with respect to it - it does not therefore mean it should be read as an additional extension of time in which to lodge. Rather, it should be read as a failed attempt to create a remitter in some circumstances. If it is beyond the power of the Commissioner, it is then ineffective. That, however, does not mean that it ought to be read as being something other than it was plainly intended to be.
4. In the result, this alternative submission should also be rejected.

3. Conclusion: The concession does not extend the lodgment end date

1. When read in context, the terms of the I&T Concession Subsection do not extend the lodgment end date to [7] June 2016 for any taxpayer in the I&T Section. Instead, all that was provided by that subsection was for the remission of an administrative penalty that had accrued vis-à-vis those taxpayers who had lodged their tax return out of time (and satisfied defined criteria).

In any event, is EMH an entity to which the 5 June concession could reasonably apply?

1. Even if the TALP could be construed as somehow extending the date on which certain entities might lodge their returns, it would not assist EMH for it does not fall within the two classes of entities to which the relevant concession applies (recall supra [50]).
2. In relation to the first group of entities, their required characteristics are that they:

(1) were non-taxable or received a credit assessment in the latest year lodged;

(2) are actually non-taxable or receiving a credit assessment in the current year (unless due earlier);

(3) are an entity with a lodgment end date of 15 May 2016; and

(4) are not large/medium taxpayers or head companies of consolidated groups.

1. In relation to the second group of entities, their required characteristics are that they:

(1) are individuals, partnerships or trusts;

(2) have a lodgment end date of 15 May 2016; and

(3) who have made payment of their tax liability by 5 June 2016.

1. It is apparent that an important characteristic of the entities which might take advantage of the relevant concession are those which have no liability to the Commissioner after 5 June 2016. In relation to the first group of entities, they will satisfy that criterion if they are "actually" non-taxable or will be receiving credit in the current year. In relation to the second group, although they will be taxable in the current year, the concession will apply so long as they have paid their tax liability by the required date.
2. Here, it was not in dispute that EMH's tax liability to the Commissioner was some $9m for the 2015 tax year. Nor was it in dispute that EMH had not paid that amount by 5 June 2016 (or anytime thereafter until its dispute as to its liability to pay was resolved: see Hyder v Federal Commissioner of Taxation [2023] FCAFC 29). Yet, EMH claimed, in the first instance, that it had paid its tax liability (being a "nil" amount) within the required time (so as to fall within the second group of entities identified above) and, in any event, was "actually non-taxable" at all relevant times (so as to fall within the first group). This was said to be because, for the purposes of the TALP and s 5-5 of the ITAA97, if a registered tax agent lodges a return that shows their client has a nil liability for tax, then the taxpayer will have no liability to pay tax and is "actually non-taxable", even if the Commissioner later assesses them to be liable for an amount.
3. To be precise, Mr Robertson KC framed the submission in his oral address as follows:

MR ROBERTSON: And so this concession, according to this decision maker, is only available if you put in a lot more hard work with the ATO at that time. And we say that, no, this is simply telling tax agents what to do with the approved form and the whole regime relies on tax agents' honesty and competence to put in returns that are true and fair and based on the best information that their clients give them, and that it is inevitable that when the Commissioner assesses and audits, there will be occasions when the commissioner assesses the tax differently. And we say that if that occurs and there's a tax shortfall, then there are penalty regimes that apply separate penalties to that tax shortfall. And that has got nothing to do with what we're talking about here ...

...

MR ROBERTSON: We say "actually non-taxable" in the first [paragraph of the second row of the table at supra [50]] means actually showing a - showing - the tax return shows you're non-taxable or you're entitled to a refund. We say the first box - - -

HIS HONOUR: Yes, yes.

MR ROBERTSON: - - - is talking about what is shown in the tax return, and that's made clearer, as well, in other areas in the document. If we go to page 174, for 15 example, see that box talks about:

... except large or medium taxpayers or head companies with consolidated groups.

So if we go over to page 174 on consolidated groups and lodgement dates, your Honour, you will see those dot points under the 15 January lodgement date and under the 28 January lodgement date. Some of the lodgement - they talk about:

So it's talking about what is shown in the tax return, whether you're entitled to - whether you're going to be receiving a refund, or whether you're non-taxable. It's not talking about the subsequent assessment process.

1. It is important to understand such submission in the context of the purpose of the FTL penalty and the I&T Concession Subsection. As above, the FTL penalty is an "administrative penalty" imposed where a taxpayer fails to give a return to the Commissioner in an approved form by a defined day. The I&T Concession Subsection insulates individuals and trusts from that liability if there exists some redeeming factor (being those conditions set out in the table at supra [50]): for example, if the taxpayer lodges their return within 21 days after the defined day and has no outstanding liability to the Commissioner, for the relevant income year, at that time.
2. This raises a difficult question: is that outstanding liability to be defined by the taxpayer or the Commissioner? Both understandings could reasonably be seen to render unpalatable results - on the first view, taxpayers who lodge a tax return within 21 days of the defined day and assert a "nil" tax liability would always be within the ambit of the concession whereas, on the second view, taxpayers who lodge a tax return within 21 days of the defined day and genuinely assert a liability that is subsequently assessed to be less than what is, in fact, owed, would fall beyond the ambit of the concession. That being so, when regard is had to the language and purpose of the concession, the second understanding is to be preferred. For instance, effect must be given to the expression "actually" before the words "non-taxable" in (the first paragraph of the second row of) the table in the I&T Concession Subsection: its inclusion conveys, upon an objective reading, an intention to eschew any argument that a taxpayer is non-taxable in the relevant year merely because their agent lodges a nil tax return. Whilst the language of the second paragraph - "provided payment is also made by this date" - is more ambiguous, when it is understood as comprising a pre-condition to a concession from liability that would otherwise be imposed (i.e., the FTL penalty), it is more coherent for the Commissioner to be charged with an assessment of whether it has been satisfied in any given case (that is, to decide whether any such payment discharges, in fact, the relevant taxpayer's income tax liability for a given income year).
3. On that basis, and accepting that EMH's actual tax liability for the 2015 year was greater than nil, it is unclear how EMH falls within either group of entities to which the concession applies.
4. EMH also sought to rely on a construction of ss 5-5(5) - (6) of the ITAA97 to the effect that it fell within the characterisation "actually non-taxable" as it was, at least on its submission, only obliged to satisfy its taxation liability 21 days after receipt of the Assessment Notice. In effect, that appears to rely on s 5-5(6); how that can be is, with respect, unclear in circumstances where the essential integer upon which that section operates - namely, that the taxpayer lodge their "return on or before the return day" - was not satisfied. Here, that date was not later than [16] May 2016 and it is accepted that EMH did not lodge the 2015 Return before then.
5. That being so, s 5-5(5), which is applicable here (where EMH was not a self-assessment entity), renders the relevant taxation liability due and payable 21 days after the day upon which the taxpayer was required to lodge its return. It is not concerned only with cases where the return was relevantly lodged within that time, and it applies where the taxpayer has either lodged the return late or failed to lodge it at all. The touchstone of the obligation to pay is the date upon which the taxpayer is "required to lodge" the return, and that which must be paid is the income tax for which the taxpayer is liable. There is nothing - express or implicit - in the section that suggests that the liability is in respect of that which the taxpayer claims they are to pay. The section is not concerned with the amount which the taxpayer puts in their return, but with the actual "income tax" liability. In this case, that is the amount which the Commissioner assesses.
6. EMH appeared to submit that there was some unjustness in this operation of ss 5-5(5) and (6) of the ITAA97. The submission that was made by Mr Robertson KC was as follows:

First, it is internally inconsistent and capricious. If the Applicant had $1 to pay as per its return and paid it on lodgment, then the required date would plainly be 21 days after 15 May 2016. "Nil tax to pay", juxtaposed with this other, ex hypothesi, separate category, means that the actual tax to pay is nil as shown in the return.

(Emphasis in original).

1. The import of that is difficult to discern. Nevertheless, the second sentence is correct insofar as it contemplates that if a taxpayer lodges their return with the Commissioner within time, the amount payable is due 21 days after the day on which lodgment was due. However, it is then seemingly said that if the taxpayer lodges a return asserting that no tax is payable, then it would be unjust that the true amount is payable 21 days from the date of lodgment, even though the return is erroneous. Why that might be so is far from apparent, ex hypothesi or not.
2. The Commissioner surmised that EMH's submission in this respect sought to parallel a similar submission that had been advanced before the High Court in Commissioner of Taxation v Ryan (2000) 201 CLR 109 (Ryan). There, the taxpayer (Mrs Ryan) had lodged a return of her income for the year ending 30 June 1987 which stated that her taxable income was below the threshold at which income tax was levied. The Commissioner subsequently issued a "Refund Notice" to Mrs Ryan in December 1987, which stated that the tax on her taxable income was "$0.00" and that she was entitled to a specific refund. More than six years later, the Commissioner issued the taxpayer with a notice of assessment for the year ended 30 June 1987 which stated that her taxable income had been assessed at a higher amount and that tax, Medicare levy and additional tax were payable (the 1994 Assessment). Mrs Ryan objected to such: see 118 - 119 [1] - [4].
3. At the heart of the case before the Court were the terms of s 170(3) of the ITAA36, which then provided, in part, that "no amendment of [an] assessment increasing the liability of the taxpayer in any particular shall be made after the expiration of 3 years from the date upon which the tax became due and payable under that assessment". On the Commissioner's submission, because no income had been assessed in December 1987 (such that no tax was then "due and payable"), it followed that the limitation period prescribed by s 170(3) had not begun to run in 1987.
4. By contrast, Mrs Ryan complained (at 123 [18]) that:

... it was "unjust" or "incongruous" or "absurd" if a taxpayer assessed to $1 tax could not be reassessed after the expiration of three years from the date on which the tax was due and payable, but a taxpayer who had been told by the Commissioner that nothing was owed, "remained at risk" without any limit of time.

1. A majority of the Court (Gleeson CJ, Gummow and Hayne JJ) held that the central question - whether three years had lapsed since the occasion on which tax for the 1987 year had become due and payable by Mrs Ryan - was to be answered by reference to principles of interpretation, rather than assertions of policy or general intention. Their Honours said (at 123 [20]):

... But the question for decision is what are the circumstances in which an amended assessment may lawfully be issued? That question is not answered by asserting the existence of any "policy" or "general intention" unless that policy or intention is to be found reflected in the provisions of the Act. Appeals to general notions of "fairness" or "justice" do no more than attempt to mask the absence of any foundation in the legislation for the conclusion which is asserted.

1. In the result, the Court (Gleeson CJ, Gummow, Hayne and Callinan JJ; Kirby J dissenting) held that the Commissioner was not prevented from issuing the 1994 Assessment because, they having determined that no tax was due and payable in its correspondence of December 1987, the period fixed by s 170(3) of the ITAA36 had not yet begun to run.
2. Here, also, little can be gained by reference to assertions of fairness, policy or general intention. Rather, attention must be paid to the words of the statute and the principles of interpretation. Furthermore, it can readily be accepted that Mrs Ryan's predicament is far from that which EMH now complains. Here, the "nil" return lodged by EMH for the 2015 income year was not accepted by the Commissioner. Nor was any acknowledgement given to it that that return was correct. Instead, the Commissioner audited EMH (and associated persons and entities) and, having done so, made a substantial assessment of income tax that was, eventually, accepted.
3. In this respect, Mr Robertson KC sought to assert that "since Ryan's case ... and the advent of "tax offset refunds", the definition of "assessment" in s 6(1) ITAA36 has been modified". That section now relevantly provides:

(a) the ascertainment:

(i) of the amount of taxable income (or that there is no taxable income); and

(ii) of the tax payable on that taxable income (or that no tax is payable); and

(iii) of the total of a taxpayer's tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or

Note 1: A taxpayer does not have a taxable income if the taxpayer's deductions equal or exceed the taxpayer's assessable income: see subsection 4-15(1) of the Income Tax Assessment Act 1997.

Note 2: A taxpayer may have no tax payable on an amount of taxable income if that income is below the tax-free threshold or if the taxpayer's tax offsets reduce the taxpayer's basic income tax liability to nil.

1. Emphasis was sought to be placed upon the language "(or that no tax is payable)" in subsection (a)(ii), as well as subsection (a)(iii) in toto. With respect, it is difficult to understand that which EMH sought to make of these amendments. True it is that they identify that an "assessment", for the purposes of the ITAA36, may include a conclusion that there is no taxable income or that no tax is payable (per subsection (a)(ii)), however, none of that seems relevant here where the acknowledged assessment of EMH's tax liability was some $9m. In their written outline of submissions in reply, EMH seemed to suggest this new definition meant that the lodgment end date was to be extended where there was no tax to pay: "the lodgment date is extended for individuals, partnerships and trusts where there is no tax to pay, a refund is due, or if there is tax to pay, payment as made at the time of lodgment by that extended date". Here, however, there was tax to pay (and a substantial amount of it) and that fact did not change merely because EMH asserted (erroneously), in the 2015 Return, that there was none.
2. It follows that there is no basis on which it might be said, for the purposes of the TALP, that EMH was "non-taxable" in the 2015 income year or had paid the tax which it was required to pay for that year prior to [7] June 2016. Accordingly, even if the I&T Concession Subsection could be taken as extending the lodgment end date to [7] June 2016, EMH did not fall within either of the categories of taxpayers entitled to take advantage of any such extension.

A related issue: GIC being payable prior to an assessment

1. A further submission advanced by EMH was that GIC can only logically apply where there is an unpaid tax debt. To quote that which is set out in its written outline of submissions:

... GIC only runs where there is an unpaid tax debt, and that can only occur once the Commissioner reviews the lodged return and from that and the other information in his possession, applies the substantive provisions of the Tax Acts, including the discretions reposed in him, to determine the tax due to the Commonwealth, and then notifies the taxpayer of his assessment thereby creating a pecuniary tax liability under s 255-5 in schedule 1 Taxation Administration Act 1953.

A taxpayer cannot strictly work out its taxable income and the actual tax to pay except as a best estimate of how the Commissioner would or would not form the various opinions and discretions reposed in him (the subjective criteria of liability). A taxpayer can only give the Commissioner the information the Commissioner requires to be given in the tax return (ss 161 and 161A Income Tax Assessment Act 1936). Then the Commissioner's assessment process under s 169 ITAA36 (for trustees) starts and, as Dixon J observed in [Denver Chemical Manufacturing Co v Commissioner of Taxation (NSW) [1949] HCA 25; (1949) 79 CLR 296], "the ascertainment of taxable income must in all respects be dependent upon opinions, judgments, and conclusions on the part of the commissioner". Moreover, in the case of a trustee's liability to be "assessed and pay tax", the actual rate of tax is a matter in every case dependent on the Commissioner's opinion as to which of the rate in s 99 ITAA36 and the rate in s 99A ITAA36 should apply: see Giris Pty Ltd v Commissioner of Taxation [1969] HCA 5; (1969) 119 CLR 365.

1. In this respect, reliance was sought to be placed upon the observations of Isaacs and Higgins JJ in Commissioner of Stamps (WA) v West Australian Trustee, Executor and Agency Company Limited [1925] HCA 20; (1925) 36 CLR 98. At page 108, their Honours posed the following question:

How can there be a debt except for the tax; and how can the amount of tax be calculated until the exact amount of taxable income is determined; and how can the amount of taxable income be known until the Commissioner's decision or opinion is given?

1. It was submitted that, so long as the taxpayer complies with the Commissioner's requirement to lodge a "tax return within 21days after 15 May each year and pays the tax if any, it calculates as a matter, at best, of probability, then it has satisfied the lodgment date requirement".
2. This further exhortation to some alleged underlying injustice should be rejected, and the legislation should be applied according to its terms.
3. The context of the obligation to pay GIC includes s 5-5 of the ITAA97 and, in particular, s 5-5(3). That subsection provides that where the Commissioner makes an assessment of a taxpayer's income for a given income year, the tax may be taken to have been due and payable at a time "before" the assessment was made and, as the Note to the section makes clear, that is in order to "ensure that general interest charge begins to accrue from the same date for all like entities". In relation to an entity that is not a "self-assessment entity", ss 5-5(5) - (6) provide a logical and rational scheme for the lodgment of a return. If it is lodged within time and the correct amount of tax is paid by the return date, being 21 days from the date required for lodging, no GIC will be payable. If it is lodged on time but the Commissioner subsequently gives an assessment for a greater amount of tax (for instance, upon the basis that the return articulated an incorrect amount of tax), the taxpayer has 21 days following the giving of the notice of assessment in which to pay the assessed tax before the GIC commences to accrue.
4. Here, EMH did not take advantage of the benefits to be derived from the scheme when a return is lodged within time. It having not lodged within the time available for the purposes of s 5-5(6) of the ITAA97, its taxation liability (being subject to determination by the Commissioner at some later date) was payable 21 days from the date on which it had been required to lodge the 2015 Return (i.e., [16] May 2016). In this respect, EMH's real complaint appears to be that it did not take the advantage which flowed from lodging its return on time and now claims a benefit to which others, who also did not lodge on time, are not entitled.
5. EMH submitted that the circumstances of this case highlight the problematic consequences of the Commissioner's construction. It was said that the Commissioner took too long to undertake the assessment and that the Commissioner should have made an initial "nil" assessment and subsequently issued an amended assessment. This, so it was said, would have limited the amount of GIC that accrued. The relevance of this submission to any issue in the proceedings was unclear. The Commissioner was under no obligation to do as EMH alleged.

Conclusion: EMH was required to lodge the 2015 Return by [16] May 2016

1. The following conclusions arise from the foregoing. The I&T Concession Subsection provides for the remission of an administrative penalty that is imposed where a taxpayer fails to provide a tax return to the Commissioner by the relevant lodgment end date; it does not serve to extend or otherwise modify that date. In any event, EMH is not an entity which falls within the ambit of the concession provided by the I&T Concession Subsection. On these grounds, it follows that the Decision adopted a correct understanding of the law and, in particular, that the date by which EMH was required to lodge its return was [16] May 2016 (and that it did not do so).
2. On the basis of the foregoing, EMH's 2015 income tax liability was "due and payable" 21 days after [16] May 2016 - being [7] June 2016: s 5-5(5) of the ITAA97. Necessarily, GIC would accrue from such date. It is not suggested that EMH lodged the 2015 Return prior to 7 June 2016. To this extent, the conclusions in paragraph [4] of the Decision are entirely correct.

Do EMH's submissions accord with the Application?

1. The written outline of submissions filed by the respondent asserts, inter alia, that EMH fails to "properly address the grounds of review in its submissions". Prima facie, there is force in that assertion and, in order to appreciate its force, it is appropriate to deal with the alleged grounds of review in sequence.
2. The crux of the Application has been summarised above (see supra [32]). On any view, it is in a somewhat confused state. By the amendments of 4 June 2025, it appears that there is only one ground of review (being that the Decision was an unlawful and improper exercise of power) and the allegations which previously constituted the grounds of review have been turned into, by the amendments, particulars of this broad assertion.
3. The first particular of review was that that the Delegate had erred by not concluding that, on a proper construction of s 5-5(6) of the ITAA97, there was no tax payable by EMH and, therefore, no basis on which the GIC could be imposed. In part, that ground relied upon the conclusion that the date on which EMH was required to pay its 2015 income tax liability was 10 June 2020 (being 21 days after the date on which the Delegate furnished it with the Assessment Notice). However, and as indicated above, that ground fails because EMH did not lodge the 2015 Return within the time required to fall within the ambit of s 5-5(6) (being [16] May 2016), such that it was required to pay its 2015 income tax liability within 21 days of [16] May 2016 (i.e., by [7] June 2016: s 5-5(5)); EMH's failure to do so led to the accrual of GIC from that date.
4. The second particular of review was identified in the following terms:

The Respondent misidentified the day he required the Applicant to lodge its income tax return (the return day) as 15th May 2016, when in fact the return day was 21 days after 15th May 2016, being Monday 6th June 2016 for taxpayers who lodged returns showing nil tax to pay, which included the Applicant (Reasons paragraph 1).

1. For the reasons given, the date on which EMH was required to lodge the 2015 Return was [16] May 2016, such that the premise of the alleged error falls away. In addition, even if there were an extension of time in which to lodge a return, it only applied to entities which were "actually non-taxable" or had paid their liability by [7] June 2016. EMH did not satisfy that requirement.
2. The third particular of review was that the Delegate erred in deciding that EMH was required to establish that it was non-taxable in the 2015 income tax year and it had not done so. For the reasons given, EMH did not establish it was within the scope of the I&T Concession Subsection of the TALP, and the facts on which the matter proceeded did not include any suggestion that it was non-taxable as required. The Delegate was correct to conclude that EMH had not shown that it satisfied this requirement of the concession, to the extent to which it was relevant.
3. The fourth particular of review asserts that the Delegate "took into account the irrelevant consideration" that EMH's tax agent had not made an application for a deferral beyond the date of 15 May 2016. That is a somewhat unusual submission in circumstances where EMH had positively submitted to the Delegate, in 2024, that an attempt had been made to lodge the 2015 Return on 6 June 2016, but it had been unable to do so because of an alleged "Citrix system receiver issue". EMH further asserted that its agents "would have" informed the Commissioner of this at the time. In considering this submission, as the Delegate was required to do, he identified that, on 6 June 2016, the tax agent had made an application for deferral for others of its clients, but no deferral application was made for EMH (with the consequence being that s 5-5(6) of the ITAA97 did not apply because the return was not lodged on or before the due date of [16] May 2016). The decision-maker's consideration of whether a deferral was made was responsive to EMH's submission that it lodged its return within time and, it follows, there is no merit in the submission that it was an irrelevant consideration. Indeed, the Delegate would have erred had he not addressed EMH's submission in this regard.
4. The second ground of review was that the Delegate erred when it "mistakenly took into account that the Applicant did not lodge its return by an irrelevant date (15 May 2016), which was not the return date applicable to the Applicant's circumstances". For the reasons articulated above, that was the lodgment end date for EMH and, again, there is no merit in this ground.

1. In its written outline of submissions in reply, EMH raised further alleged errors in the Decision which were not contained in the Application. The fact that they are not properly raised means that they can be ignored. That said, it is not inappropriate to refer to them to some degree.
2. The first additional ground is to the effect the Delegate erred in identifying that the "lodgment due date" for certain non-taxable entities was 5 June 2016. It is true that, if the Delegate was referring to the date on which those entities were to lodge their returns, that construction of the TALP is incorrect. The date on which the entities, which might take advantage of the 5 June 2016 concession, were to lodge their returns was [16] May 2016. However, that erroneous statement is entirely inconsequential; that is because the Delegate correctly held that EMH was not an entity that fell within the concession. No material error could arise from an erroneous supposition of how a provision might operate given it has been correctly determined that it does not apply to the taxpayer: LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12; (2024) 280 CLR 321. There is no real possibility (that is not fanciful or improbable) that the Decision could have been different if the error had not occurred.
3. It is sufficiently clear that the Delegate identified [16] May 2016 as the date upon which EMH was required to lodge the 2015 Return. So much appears from paragraph [1] of the Decision to the effect that EMH was entitled to the tax agent lodgment concession of 15 May 2016. The same can be derived from paragraph [4], where the Delegate identified that the GIC correctly accrued from 7 June 2016, being 21 days after the payment date of [16] May 2016. That aligns with s 5-5(5) of the ITAA97, which required an entity in the position of EMH to pay the tax liability within 21 days of the date on which it is required to lodge its return. It is noted that the reasons seemingly refers to 21 days after the "payment date", though it is clear that this is intended to be a reference to the lodgment date. The day which is 21 days after the lodgment date is the correct date on which the tax is due and payable: (s 5-5(5) of the ITAA97): and the date on which the GIC becomes payable if that tax liability is not paid: (s 5-15 of the ITAA97).
4. Though there was some inaccuracy or infelicity in the expression of the Decision, the substance of it cannot be doubted, and it is obviously correct. The Court should be careful not to construe the Delegate's reasons too pedantically: see, eg, Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259, 291.

1. No relevant error has been demonstrated in the conclusion or reasons of the decision-maker. The issue which had to be dealt with was somewhat confined in the light of EMH's contentions. The Delegate rejected EMH's contention that it was entitled to lodge the 2015 Return 21 days after [16] May 2016; that conclusion was correct. They also rightly concluded that the date for lodging was [16] May 2016 and rejected EMH's contention that a deferral in relation to its lodgment of a return had been sought. The correctness of that cannot be seriously contended. The Delegate further rightly rejected the contentions that the date by which EMH was entitled to lodge a return was [7] June 2016 and that s 5-5(6) of the ITAA 1997 required it to pay any assessed tax liability 21 days after it was provided the Assessment Notice. This latter section did not apply to EMH by reason that it had not lodged a return on or before the required date.
2. Ultimately, the decision was rather straightforward. The Delegate correctly identified the date by which EMH was to lodge the 2015 Return as [16] May 2016. As it did not lodge it by that date, most of EMH's contentions fell away. Further, EMH had not provided any sufficient reasons to show that the delay in paying the tax was not caused by its acts or omissions and that it took reasonable steps to mitigate the delay. That conclusion was not shown to be in error in any shape or form.

1. No jurisdictional error has been demonstrated in the reasons of the Delegate. It follows that the application for review should be dismissed.
2. The Commissioner is entitled to an order that the applicant pay his costs of the Application.

I certify that the preceding one hundred and fifteen (115) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Derrington.