INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART VII - PENALTY TAX  

SECTION 226M   PENALTY BECAUSE PRIVATE RULING DISREGARDED  

226M(1)   [Additional tax]  

Subject to this Part, if:

(a) a taxpayer has a tax shortfall for a year; and

(b) a private ruling was made on the way in which an income tax law applies to the taxpayer in respect of the year in relation to an arrangement; and

(c) the shortfall or part of it was caused by the taxpayer, in a taxation statement made after the private ruling was made, treating that law as applying to the taxpayer in respect of the year in relation to the arrangement in a different way;

the taxpayer is liable to pay, by way of penalty, additional tax equal to 25% of the amount of the shortfall or part.

226M(2)   [Court order or Tribunal decision]  

Subsection (1) does not apply if there is an order of a court, or a decision of the Tribunal, that applies to the private ruling.