Jeremy Apted, an Australian sole trader has been granted access to JobKeeper following the Full Federal Court unanimously ruled that the Australian Tax Office was incorrect in its decision to not grant his business more time to establish it’s eligibility.
This case which is referred to as “The JobKeeper test case” was centred around whether or not Mr. Apted had met the eligibility requirement to hold an ABN on or before 12th March 2020.
Jeremy Apted, who works as a specialist retail valuer, previously held an ABN since 2012 but had it cancelled in 2018 as he decided to retire.
When he resumed work in September 2019 he failed to reactive his ABN because he accidently assumed that he only needed one if he required to be registered for GST.
When the covid-19 pandemic hit, Mr. Apted reactivated his ABN and applied for JobKeeper, but his application was knocked back because he missed the 12th March deadline. By missing the deadline, he decided to contact the Australian Business Register to successfully have his ABN reactivation backdated to 1st July 2019.
Regardless of Mr. Apted’s ABN registration being backdated, the ATO disallowed his objection. This resulted in Mr. Adpted to apply to the Administrative Appeals Tribunal (AAT) for a review.
The tribunal ruled in favour of Mr. Adpted, stating that he satisfied all of the eligibility criteria and was “the kind of person who was intended to benefit from the JobKeeper scheme”.
Despite the ruling, the ATO turned to the turned to the Full Federal Court to appeal the AAT decision. To state their case, the ATO argued that the 12th March 2020 requirement was a point-in-time test and that if the Australian Business Register had been inspected on that date, it would have shown if an entity had an ABN.
The Full Federal Court agreed with the ATO’s view, but in the end ruled that the commissioner should have exercised his discretion to enable a later date for Mr Apted to hold an ABN and thereby satisfy the eligibility rules for JobKeeper.
“As is made plain by government announcements and the provisions of the legislation, the JobKeeper payment was intended to benefit taxpayers in Mr Apted’s general circumstances,” said Honourable Justice Thomas Thawley.
“The commissioner, in his reasons, did not point to any good reason not to exercise the discretion in s 11(6) in Mr Apted’s favour; it is clear that the real reason for the commissioner’s refusal to exercise the discretion was the lack of ABN registration on 12 March 2020.
“But this was the very thing which lay the foundation for the exercise of the discretion. Of itself, this was not a proper basis to refuse to exercise the discretion.”
Honourable Justice John Logan also said that the Australian Business Registrar — the Commissioner of Taxation in another guise — had accepted that Mr Apted was running an enterprise before 12 March 2020, giving “pause for thought as to why Mr Apted has been put to so much bother in relation to his eligibility to receive a payment the object of which ‘is to provide financial support directly or indirectly to entities that are directly or indirectly affected by covid-19”.
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