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What may short-process rulings cover

Short-process rulings are suitable for most commercial arrangements or business transactions that may have an uncertain tax treatment.

Examples of short-process ruling questions include whether:

  • a company has a taxable activity for GST purposes
  • the property bright line test applies to a sale of property
  • two people are associated
  • an item of property is trading stock
  • a non profit organisation can issue donation receipts for a payment
  • the sale of a trademark should be treated as royalty income
  • a person carries on business through a permanent establishment.

Generally, it’s the more complex business transactions that may have unclear tax implications where a short-process ruling would provide certainty.

Declining an application

We may decline to make a ruling if, for example, the application:

  • raises an issue involving an apparent gap in policy settings
  • is in opposition to our existing policy or technical position
  • raises an issue that has significant implication or effect as a precedent
  • does not provide enough information
  • raises a question that is better answered through another process, like a public or product ruling.

Advance pricing agreements are not covered under short-process rulings.

We may also decline if:

  • the application is received after a tax (excluding provisional tax), duty or levy is already due and payable
  • you or a joint applicant is subject to audit or investigation relating to the situation you are applying for a ruling on
  • an assessment relating to the situation has already been made
  • the disputes process has already started in relation to the situation.

If we decline to rule on your application, we will let you know the reason and will refund your fee.

Last updated: 28 Apr 2021
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