High Court decision in ‘Sharpcan’ capital/revenue case

Gaming machine entitlements a capital asset despite risk of forfeiture.

The High Court has overturned the 2 to 1 decision of the Full Federal Court and unanimously held that the amounts paid by a taxpayer to acquire a number of gaming machine entitlements (GMEs) that allowed it to operate gaming machines were on capital account and not deductible under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997). The amounts paid also did not qualify for a deduction as black-hole expenditure under section 40-880 of the ITAA 1997.The decision in Commissioner of T...

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Authors: Richard Wilkins

Published Date: 20 October 2019