Morris v Chief Commissioner of State Revenue  NSWCATAD 219
|Date of judgement||11 October 2016||Proceeding No.||1610074|
|Judge(s)||A Boxall, Senior Member|
|Court or Tribunal||New South Wales Civil and Administrative Tribunal|
|Legislation cited||Land Tax Management Act 1956 s10 and Schedule 1A|
|Catchwords||Land tax - principal place of residence|
|Cases cited||Paspaley v Chief Commissioner of State Revenue  NSWCATAD 217
Spiros Theophilas v Chief Commissioner of State Revenue  NSWCATAP 39
The case concerned an application for review of the Chief Commissioner of State Revenue’s (“Chief Commissioner”) decision to assess the Taxpayer as liable for land tax for the 2015 land tax year (“the relevant period”) in relation to the property located at Soldiers Point Road, Salamander Bay NSW (“Soldiers Point Property”).
The issue in these proceedings was whether the Taxpayer was eligible for an exemption from land tax with respect to the Soldiers Point Property, on the basis that this property was the Taxpayer’s principal place of residence for the relevant period, pursuant to s 10(1)(r) and cl 8(1) of Schedule 1A of the Land Tax Management Act 1956 (NSW) (“the Act”).
During the relevant period, the Taxpayer was the sole registered proprietor of the Soldiers Point Property, which he occupied with his wife, Mrs Morris. In addition to the Soldiers Bay Property, the Taxpayer owns a 50% interest in a property at Yachtsman Crescent, Salamander Bay NSW (“Yachtsman Crescent Property”) as a tenant in common with his sister, Ms McDonald.
The Taxpayer and Mrs Morris decided to demolish and rebuild the house at the Soldiers Point Property. For the duration of the construction at the Soldiers Point Property, the Taxpayer agreed to rent the Yachtsman Crescent Property from Ms McDonald under the same terms as the previous tenants, whose lease was ending. In August 2014, the Taxpayer and Mrs Morris vacated the Soldiers Point Property and moved into the Yachtsman Crescent Property. The Taxpayer moved various belongings into the Yachtsman Crescent Property, and placed other significant items including artwork and a piano in storage.
Cl 8 of Schedule 1A of the Act relevantly provides:
A person is taken, for the purpose of the principal place of residence exemption, to continue to use and occupy land formerly used and occupied by the person as a principal place of residence (a former residence), after the person ceases to so use and occupy the former residence, if the Chief Commissioner is satisfied that:
the person used and occupied the former residence as a principal place of residence for a continuous period of at least 6 months, and
the person does not own any other land used and occupied by the person as a principal place of residence.
The Taxpayer referred to the decision of the NSW Civil and Administrative Tribunal Appeal Panel in Spiros Theophilas v Chief Commissioner of State Revenue  NSWCATAP 111, to distinguish between a mere place of residence and a principal place of residence. The Taxpayer submitted that the Yachtsman Crescent Property was merely a temporary place of residence, whereas the Soldiers Point Property continued to be his principal place of residence. In addition, the Taxpayer submitted that cl 8(1)(b) of Schedule 1A of the Act should be read as applying if the person does not own any other land that is used, occupied, and owned by them as a principal place of residence. The Taxpayer contended that the Yachtsman Crescent Property was co-owned by him as an investment property, rather than as a principal place of residence.
The Chief Commissioner emphasised that the definition of ‘owner’ in s 3 of the Act includes joint or several ownership of land. The Chief Commissioner submitted that cl 8(1) could not apply to the Soldiers Point Property, because during the relevant period the Taxpayer was entitled to the PPR exemption for the Yachtsman Crescent property which he used and occupied as his principal place of residence.
Senior Member Boxall held that the exemption under cl 8(1) of the Act could not apply since the Taxpayer was at all relevant times an owner of the Yachtsman Crescent Property, and that during the relevant period the Taxpayer used and occupied this property as his sole – and necessarily principal – place of residence, since there was no viable residence on the Soldiers Point Property.
Senior Member Boxall affirmed the Chief Commissioner’s decision.