1. The respondent submitted in the objection decision, its SFIC and at hearing the reasons for and circumstances surrounding the disposal of a CGT asset are not relevant to whether the CGT event occurred or how any gain is calculated. It was submitted any CGT event was not dependant on a profit making intention by the Trust and the reasoning behind the sale by the Trust does not prevent the CGT event from happening.
2. The respondent disagreed with the applicant's contention that s 102-5 of the ITAA emphasised the imposition of CGT must reflect the intent and circumstances of the taxpayer. The respondent submitted that section relates to the methodology to be used in determining a capital gain and reveals no general discretion to disregard a gain based on the reasons or intent behind the sale of the asset. Similarly, the respondent considered the cases raised by the applicant as supporting his contentions to be irrelevant to his circumstances.
3. The respondent contended there were no exemptions or concessions that applied to the applicant to disregard or reduce the capital gain made as a result of the disposal of the shares. He was not entitled to the discount method under s 115-5 of the ITAA, nor the relief for small business under s 152.10. Nor was s 118-195 relevant to his circumstances to allow the capital gain to be disregarded as that section relates to dwellings disposed of in connection with deceased estates.
4. Statutory discretions are available in certain situations and are outlined in the ITAA. The respondent submitted if it was the intention to provide a decision-maker with the discretion to disregard a capital gain in the circumstances described by the applicant, the legislation would have provided for such. The respondent contended no such discretion exists. It was submitted there is no power to allow the respondent to excise a capital gain from the applicant's 2020 assessment.
5. In relation to any breach of the Model Litigant Obligations, the respondent noted those obligations do not restrain the respondent from defending its position in a proceeding brought against the Commissioner. Furthermore, the applicant has not identified any specific conduct which would demonstrate a breach of the obligations, which it submitted had not occurred. In any event, if there was a breach, which was denied, it would not mean the assessment of the respondent was excessive.
6. The respondent submitted there had been no violation of administrative or public law principles, as it was the statutory duty of the respondent to assess tax in accordance with the law. The respondent cannot remove tax properly payable from an assessment. Any waiver of the debt or act of grace payment sought by the applicant are discretions exercised by the Finance Minister, not the respondent or the Tribunal. The respondent considered any suggestion that the enforcement of CGT is inhumane, unfair or fails to account for exceptional circumstances amount to general commentary and do not contravene the respondent's statutory duty. The applicant, the respondent submitted, has failed to establish why in accordance with the relevant laws the assessment the subject of the proceeding is excessive.

1. The Tribunal understood the applicant's main arguments as to why he should not be liable to pay CGT on the net capital gain received in the 2020 financial year are twofold. Firstly, that the proceeds from the Trust should not be treated as a capital gain as it was the result of a forced sale and there was no profit or gain as the proceeds went to support an ailing business rather than to the applicant for his own personal use or advantage. The applicant's second main argument revolves around discretionary relief and that the Tribunal ought to disregard the capital gain in his 2020 assessment because of the unprecedented circumstances of COVID-19 and the impact that had on his business and personal circumstances.
2. The Tribunal accepts on the evidence of the applicant, despite not having been provided with any documentary or corroborative evidence to support this proposition, that he felt compelled to sell shares to help financially support his ailing business due to lockdowns and that in the absence of any evidence to the contrary the proceeds were used for this purpose. It is not in dispute the proceeds distributed to the applicant upon the sale of the shares was in the amount of $201,976.
3. The applicant argued that he did not make a gain or a profit from the sale of the shares, as he used the funds to support his ailing business, and therefore the proceeds should not be taxed as a gain. In ordinary usage, 'profit' is generally defined as the returns, proceeds or revenue from investments or being the amount remaining after deducting relevant costs.[13]. A characterisation of an amount as profit does not rely upon the use thereafter of those proceeds or amounts in the ordinary definition of that term.
4. The ITAA speaks to proceeds of a CGT event, being the amount received from the disposal of an asset. CGT does not look to whether a 'profit' was made, but rather whether there has been a 'gain'. The ITAA makes clear that the sale of shares in this instance constitute a CGT event. A gain is made when the capital proceeds from the event exceed the cost base of the asset the subject of the disposal. In the applicant's circumstances, the Tribunal finds the applicant received a gain, in that the proceeds of the sale exceeded the total cost base associated with the asset which he thereafter received. Furthermore, the Tribunal finds it was the applicant's intention to make such a gain, so that he could use the proceeds of that gain to help with his financial difficulties. The applicant's use of the proceeds does not change the fact he received a gain from the sale of the shares.
5. There are exemptions available under the ITAA to reduce the amount of any CGT payable on a capital gain. Division 118 outlines general exemptions, none of which apply to the applicant's circumstances. Those exemptions and roll-overs as described in this decision above do not apply to the applicant in this instance. Similarly, he is not entitled to the discount capital gain as a result of not having acquired the shares that were disposed of at least 12 months before the sale occurred, being the CGT event.
6. The applicant raised in his objection to the respondent dated 23 December 2024 that s 118-195 of the ITAA outlined special provisions to be applied where there are forced disposals of assets due to hardship. That section provides for a capital gain from a CGT event that happens in relation to a dwelling acquired from a deceased estate. This section is not applicable to the applicant's circumstances.
7. The applicant raised s 102.5 of the ITAA as support for his proposition that the intent behind the CGT provisions is to tax wealth gained from investment growth and not to penalise taxpayers where they make sales due to financial hardship. There is no part of s102.5 of the ITAA that uses this language, but rather that section speaks to the method of calculating net income to include in one's assessable income. There is no statement or section outlining that the intent, purpose or reason for the disposal of the CGT asset is to be taken into account in any way when considering the capital gain.
8. The applicant referred to the case of Montgomery as support for the requirement to consider the context and intent when determining tax obligations. The question which that case raised was whether a share of an inducement payment is income for taxation purposes. The case was argued on the basis that the ultimate issue was whether the amounts received were to be treated as income or capital.[14] The Tribunal considers this case does not assist the applicant, as although the judges determined the context and intent behind transactions were relevant to determining a taxpayer's obligations, the ultimate inquiry hinged on whether the share of an inducement payment was income or capital in nature, not whether the amount should be disregarded completely from tax obligations which the applicant seeks upon this review.
9. He also raised the case of Roche to support the requirement to recognize extraordinary circumstances impacting taxpayers when making decisions. This case considered the circumstances in which transfer prices, paid for acquisition of property by subsidiaries of multinational corporations, can be adjusted for income tax purposes and required an assessment of the benchmark for arm's length sales. This applicant's circumstances are not analogous to the taxpayer company in that case and the Tribunal finds no suggestion therein that can be relied upon to support the proposition that extraordinary circumstances or hardship can be taken into account to remove a CGT liability.
10. The Tribunal finds there are no discretionary provisions to allow the decision maker under the ITAA to take the intent, reason or purpose for the disposal of the CGT asset into account to thereafter disregard the capital gain on the basis of hardship, forced sales or the use to which the proceeds are put. There is nothing in the ITAA that requires an assessment of a capital gain to consider the context of the disposal or gain, the intention of the disposal or gain or what the gain was thereafter spent on. The ITAA is unambiguous that the sale of shares is a CGT event. It does not provide an ability to consider whether the gain was made as a result of a forced sale, what the gain was used for or whether a person's circumstances should be considered when determining if a gain has occurred.
11. The Tribunal furthermore finds there is nothing in the available case law to suggest a decision maker has the ability to consider the reasons behind the disposal of the CGT asset, or to disregard a capital gain because of any hardship or unprecedented circumstances having occurred. A taxpayer can seek a release from their liabilities due to hardship, but that only occurs once the taxation liability has crystallised, not as a means to disregard or amend the calculation of a taxpayer's assessable income.[15]
12. The applicant argued the application of the law must be reasonable and to treat the outcome of the sale forced by government intervention as a regular capital gain is unfair and an overreach. The Tribunal understands the applicant has been through difficult experiences in relation to his business due to COVID-19 related lockdowns and appreciates he continues to face financial challenges to this day. He has a substantial taxation liability in excess of $120,000 plus interest. The Tribunal understands the operation of taxation laws can present outcomes that may be considered unduly harsh or unreasonable to an individual. However, the Tribunal is required to apply the law to the facts before it.
13. The Tribunal has no general powers or discretion to review any decision or to make any decision upon review. The Tribunal is required to apply the law correctly to the facts as found. Its jurisdiction to review decisions comes from the legislation conferring power upon it. In reviewing its decision, the Tribunal can exercise the powers and discretions conferred upon the original decision maker for the purpose of reviewing that decision.[16] It has no greater power than the decision maker, and it is subject to the same constraints. The Tribunal has found above that although there are provisions that allow for a capital gain to be disregarded, there are no legislative provisions within the ITAA that confer a discretion or power to disregard a capital gain in the circumstances argued by the applicant. As such, the Tribunal has no power or discretion in this instance to disregard the gain made by the applicant.
14. Given the above, the Tribunal finds the sale of the shares, whether forced or not, constituted a CGT event. The proceeds of that sale minus the cost base therefore represented a capital gain, regardless of the subsequent use of those proceeds. The Tribunal finds there are no discounts or exemptions in the Act that apply to reduce the capital gain in the applicant's circumstances, nor is there any discretion to reduce or waive the gain as a result of hardship, the intention behind the disposal leading to the gain, what the gain was used for or extenuating circumstances. The Tribunal finds the applicant made a capital gain in the 2020 income year of $201,976, such capital gain to be included in his assessable income for that year.
15. The applicant has sought relief in the form of a setting aside of the assessment the subject of this application, or a referral to the Department of Finance for a waiver of the debt under discretionary powers. The Tribunal has no power to order a waiver of the debt under the Public Governance, Performance and Accountability Act 2013. That is a power exercised by the Minister of Finance. Neither can the Tribunal make a decision about the release of the applicant from his taxation liabilities in this instance under Division 340 of Schedule 1 to the Taxation Administration Act 1953. The decision under review relates to an assessment of what the applicant's liabilities are, and as such is the only matter for the Tribunal to consider. The applicant has not made an application for a release of his liabilities and there is no such decision before the Tribunal.
16. The applicant contended pursuing his 'tax debt...while technically permissible, violates the ethical standards imposed on the Commissioner and offends the spirit of fairness...' outlined in the Model Litigant Obligations. The only conduct claimed as offending these standards is stated to be the pursuing of the tax debt. The Tribunal is not satisfied on the assertion before it that any conduct has occurred that would be in breach of the Obligations. The Tribunal was given no evidence to suggest the respondent had pursued a debt in an inappropriate manner. The behaviour the applicant appears to take issue with is the imposition of tax upon the capital gain. The Tribunal has found above that the correct assessment of the applicant's liabilities for the 2020 income year include that capital gain for the reasons provided. The respondent arguing before the Tribunal that their objection decision was the correct decision in these circumstances does not appear to breach any such Obligation. Furthermore, the Tribunal notes, as outlined by the respondent in their SFIC, had a breach occurred, it would not render the liability void or change the decision of the Tribunal, but would provide the applicant with an avenue of complaint external to the Tribunal.

1. The applicant has not discharged his burden of proving the 2020 assessment was excessive or otherwise incorrect. As the Tribunal has found the applicant had a capital gain in the financial year ending 2020 and that there are no grounds upon which that capital gain can be disregarded or waived, the decision under review is affirmed.

1. I certify that the preceding 51 (fifty-one) paragraphs are a true copy of the written reasons for the decision herein of General Member M. Stratos

................[sgd]........................................................

Date final submissions received: 12 November 2025

Solicitor for the Respondent: Australian Taxation Office

[1] Taxation Administration Act 1953 (Cth) s 14ZZK ('TAA').

[2] Income Tax Assessment Act 1997 (Cth) s 102-5 ('ITAA').

[3] Ibid s 100-25.

[7] Ibid s 100-35.

[8] Ibid ss 102-3 and 115-1.

[11] (1999) 164 ALR 435

[12] [2008] AATA 639; (2008) 70 ATR 703

[13] Macquarie Dictionary, Ninth Edition.

[15] Tax Administration Act 1953 (Cth) sch 1 div 340.

[16] Fletcher v Federal Commissioner of Taxation [1988] FCA 362; (1988) 19 FCR 442 at 452