Issue
Is an assessment of surcharge a 'decision' to which a request for reasons for decision under section 13 of the Administrative Decisions (Judicial Review) Act 1977 (ADJR) refers?
Decision
No. An assessment of surcharge is not a 'decision' to which a request for reasons for decision under section 13 of the ADJR refers.
Facts
The member's adjusted taxable income (ATI) exceeded the surcharge threshold for the financial year. Surcharge was assessed as payable on the member's surchargeable contributions and the Commissioner of Taxation (Commissioner) issued a surcharge assessment.
The member's income tax assessment for the financial year was amended following a disallowance of an income tax deduction.
The surcharge assessment was also subsequently amended as the member's ATI for the financial year increased because of the amended income tax assessment. The increase in the member's ATI affected the surcharge payable on the member's surchargeable contributions for the financial year.
The member made a request to the Commissioner for reasons for decision in relation to the amended surcharge assessment.
Reasons for Decision
Section 5 of the ADJR states that a person who is aggrieved by a decision to which the ADJR applies may apply to the Federal Court or the Federal Magistrates Court for an order of review in respect of the decision.
Section 13 of the ADJR outlines that any person who is entitled to make an application under section 5 of the ADJR can make a written request to the person who made the decision to furnish a statement in writing setting out the reasons for the decision.
A 'decision to which this [ADJR] Act applies' is defined in section 3 and means a decision of an administrative character made, proposed to be made, or required to be made, as the case may be (whether in the exercise of a discretion or not) under an enactment, other than a decision by the Governor-General, or a decision included in any of the classes of decisions set out in Schedule 1 to the ADJR.
Schedule 1 to the ADJR outlines the classes of decisions that are not decisions to which the ADJR applies. Included in paragraph (e) of Schedule 1 are decisions making, or forming part of the process of making, or leading up to the making of, assessments or calculations of tax, charge or duty, or decisions disallowing objections to assessments or calculations of tax under specific legislation including under the Income Tax Assessment Act 1936 (ITAA 1936).
Sections 7A and 7B of the Superannuation Contributions Tax (Assessment and Collection) Act 1997 (SCTA) set out the methods for determining a member's ATI for a financial year. A member's ATI for a financial year is worked out by reference to, among other specific amounts, the member's taxable income as assessed under the ITAA 1936.
Surcharge assessments are determined by a person's ATI which is worked out by reference to specific amounts including the member's taxable income for a financial year as assessed under the ITAA 1936. The decisions leading to the making of a surcharge assessment under section 15 of the SCTA cannot be reviewed under the ADJR as it is a class of decision that are not decisions to which the ADJR applies by virtue of paragraph (e) of Schedule 1 to the ADJR.
Accordingly, an assessment of surcharge is not a 'decision' to which a request for reasons for decision under section 13 of the ADJR refers.