Raissis v Chief Commissioner of State Revenue [2019]

Background

The Applicants, Emmanuel and Spiro Raissis, owned land at Bondi (“the Bondi Property”) as tenants in common in equal shares. On 23 January 2018, the Chief Commissioner issued an assessment for land tax to the Applicants for the 2018 land tax year in respect of the Bondi Property (“the Assessment”).

The Applicants objected to the Assessment on 22 May 2018, claiming that the Bondi Property should be exempt from land tax as it was used by Emmanuel as his principal place of residence. The Chief Commissioner disallowed their objection and the Applicants commenced administrative review proceedings in the Tribunal.

Submissions and evidence

The Applicants submitted that Emmanuel resided at the Bondi Property as his principal place of residence from 10 December 2017 to 17 March 2018 and that his occupation was genuine and intended to be permanent, cut short only by unforeseen circumstances.

The Applicants and their mother each provided statutory declarations supporting Emmanuel’s claim to have resided at the Bondi Property. The statutory declarations explained that Emmanuel and his family used to rent a property owned by their mother, but had to vacate after their mother decided to sell that property.

Emmanuel declared that he decided to move to the Bondi Property, which was in a state of disrepair, and renovate the property whilst living there. He declared that he spent six nights per week at the Bondi Property and used that property to cook, eat, wash and sleep. Due to the state of repair of the building, his wife and young children lived with relatives, moving between Vaucluse and southern Sydney. It was intended that his family would join him at Bondi once renovations were complete.

The statutory declarations included explanations that:

• Emmanuel only decided to vacate the Bondi Property after learning that his wife was expecting their third child;
• Emmanuel’s mother had decided not to sell her rental property;
• These changes occurred after discovering asbestos in the Bondi Property. As evidence of his residing at the Bondi Property, Emmanuel provided an electricity bill in his name, a photograph of a utility vehicle parked at the Bondi Property, and an invoice for furniture moving services issued by a company controlled by the Applicants. The Chief Commissioner submitted that it was not clear whether Emmanuel ever resided at the Bondi Property and, even if Emmanuel had in fact resided at the Bondi Property, his residence was of a short, transient and temporary nature that was not sufficient to meet the test for the PPR exemption. To demonstrate these submissions, the Chief Commissioner relied on the following evidence:

• between January and May 2018, the Applicants were unable to conclusively inform Revenue NSW whether it was Spiro or Emmanuel who actually resided at the Bondi Property;
• the Applicants had obtained development consent to demolish the existing dwelling on the Bondi Property and construct an apartment building;
• Emmanuel had not taken any relevant administrative steps consistent with the Bondi property becoming his principal place of residence, such as updating the address on his driver licence, his mailing address, or his address on the electoral roll to reflect his residence at the Bondi Property. The Chief Commissioner argued that a lack of corroborating evidence for Emmanuel’s occupation of the Bondi Property, along with numerous inconsistencies in the documentary evidence, meant that the Applicants had not discharged their onus.

Decision

Senior Member Boxall:

• noted that, apart from the statutory declarations given by the Applicants and his mother, there was little independent evidence corroborating the accounts given in the statutory declarations (at [24]); and
• accepted the reasonableness of the Chief Commissioner’s “visceral scepticism” of the applicants’ evidence (at [29]); but
• ultimately, accepted the evidence contained in the statutory declarations, emphasising that the evidence had been given in such a way that the Applicant and his mother were subject to penalties if the contents of the statutory declarations were not true.

Senior Member Boxall was satisfied that Emmanuel’s principal place of residence was the Bondi Property as at the taxing date for the 2018 land tax year, and that he provided a sufficient explanation for the short nature of the occupation (at [27] and [30]).

Senior Member Boxall held that the evidence presented by the Chief Commissioner that the Bondi property was not Emmanuel’s principal place of residence had also occupied some other residence (at [26]) was insufficient to outweigh the applicants’ evidence.

Orders

1. The decision under review (being the land tax assessment for the 2018 land tax year) is set aside.
2. Substitute for it a decision that the property at Bondi NSW was exempt from land tax for the land tax year 2018 as Emmanuel Raissis’ principal place of residence at midnight on 31 December 2017.

Link to decision

Raissis v Chief Commissioner of State Revenue [2019] NSWCATAD 112