Neither side of the Aussiegolfa case will appeal the recent Full Federal Court decision to the High Court. Though the ATO will set out its view of the implications of the case in a Decision Impact Statement, and may update an SMSF ruling.
According to an ATO spokesperson, the tax office has informed Aussiegolfa that the ATO Commissioner will not be seeking special leave to appeal the Full Federal Court decision, in Aussiegolfa Pty Ltd (Trustee) v Commissioner of Taxation  FCAFC 122, to the High Court.
Aussiegolfa also doesn’t intend to appeal. On September 24 listed company DomaCom, which is linked to the case, announced to the stock market the “conclusion to the legal proceedings which the Company has been supporting in the Federal Court of Australia”. Though DomaCom subsequently further updated the market, as the ATO was of the view that it had until 16 October 2018 to file application for special leave to appeal.
DomaCom says its lawyers have now been advised by the Australian Government Solicitor that the ATO Commissioner will not appeal the case, in which Aussiegolfa was successful on the sole purpose test question, but failed on questions of the in-house asset rules.
“This is a milestone in our efforts to allow our own superannuation to help us address the housing affordability crisis affecting many Australians,” said DomaCom CEO Arthur Naoumidis.
“DomaCom will now focus on addressing the remaining related trust issues identified by the Full Federal Court by reviewing our constitution and disclosure documents to address these items with respect to future sub-funds,” he said.
Though the ATO spokesperson said the tax office was aware there was some media commentary that the ruling had changed the application of the sole purpose test to dealings between SMSFs and related parties. “However, the Full Federal Court emphasised that its decision with respect to sole purpose test was dependent on the factual arrangement being considered, and a different set of circumstances may have led to a different outcome,” said the ATO spokesperson.
“We note that the arrangement was still found to be in contravention of the in-house asset test and therefore ineffective from a regulatory perspective.”
The ATO will set out its views on both the sole purpose test and in-house asset aspects of the case when it issues a Decision Impact Statement. The ATO is also considering if Self-Managed Superannuation Funds Ruling SMSFR 2008/2 needs to be “clarified” in light of the Court’s ruling.