Part II: Revenue versus capital, black hole expenditure – Identifying a ‘counterfactual’

Jenny Wong continues her two-part series, examining recent High Court and Federal Court decisions which have reinvigorated discussion of the application of the general deductibility principles.

Tax teams should familiarise themselves with recent court decisions regarding the application of the general deductibility principles, to analyse the precise nature of assets acquired and what the payments are made for to justify their income tax treatment. In part two of this series, we examine the notion of a counterfactual analysis as opposed to an historical analysis, and deductibility under black hole expenditure provisions.Read part one: Revenue versus capital and black hole expend...

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Authors: Jenny Wong

Published Date: 13 July 2020