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Haddad v Chief Commissioner of State Revenue [2011] NSWADT 17 (27 January 2011)

Last Updated: 9 March 2011

Administrative Decisions Tribunal

New South Wales

Case Title:	Haddad v Chief Commissioner of State Revenue

Medium Neutral Citation:	[2011] NSWADT 17

Hearing Date(s):	1 July 2010, 14 October 2010 and 2 December 2010

Decision Date:	27 January 2011

Jurisdiction:

Before:	A Verick, Judicial Member

Decision:	The assessment for 2004 to 2009 Land Tax Years is affirmed

Catchwords:	Exemption to land tax - principal place of residence

Legislation Cited:	Land Tax Management Act 1956 Administrative Decisions Tribunal Act 1997 Taxation Administration Act 1956 Threatened Species Conservation Act 1995 National Parks and Wildlife Act 1974 Nature Conservation Trust Act 2001

Cases Cited:	McGrath and anor v Chief Commissioner of State Revenue [2007] NSWADT 46 Chief Commissioner of State Revenue v McGrath [2008] NSWSC 387 Saboune and anor v Chief Commissioner of State Revenue [2011] NSWADT 8 Chief Commissioner of State Revenue v Aldridge & Anor (RD) [2003] NSWADTAP 50 Flaracos v Chief Commissioner of State Revenue [2003] NSWSC 68 Giris v Federal Commissioner of Taxation [1969] HCA 5; (1969) 119 CLR 365 Federal Commissioner of Taxation v G M Swift and Others [1989] FCA 413; 89 ATC 5101 Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; [1985-86] 162 CLR 24 Dean v Commissioner of Stamp Duties (Qld)(No2) [1996] 2 Qd R 557 Re Ziino and Commissioner of State Revenue [2004] VCAT 1707 Chief Commissioner of State Revenue v Ferrington (GD) [2004] NSWADTAP 41 Zakariya v Chief Commissioner of State Revenue [2003] NSWADT 26 Chief Commissioner of State Revenue v McIlroy [2009] NSWADTAP 21

Texts Cited:

Category:	Principal judgment

Parties:	Sally Haddad (applicant) Chief Commissioner of State Revenue (respondent)

Representation

- Counsel:	A Rider (respondent)

- Solicitors:	J Haddad (agent for the applicant)

File number(s):	096068

Publication Restriction:

Introduction

1 The applicant has applied for a review of the Chief Commissioner's decision to assess land tax on land owned by the applicant and situated at Wadalba, New South Wales ("the Wadalba property") for the 2004 to 2009 land tax years ("the land tax years").
2 The applicant's case was that the Wadalba property was exempt from land tax in all the land tax years under the principal place of residence exemption found in s 10(1)(r) of the Land Tax Management Act 1956 ("the Act") as provided for in the various clauses of Schedule 1A to the Act. It was the applicant's case that she was entitled to the exemption under clause 2 which provides for the general exemption or under clause 6 which exempts unoccupied land intended to be owner's principal place of residence or under clause 8 for land previously used as a principal place of residence.
3 The applicant also claimed that the provisions of sections 10(1)(p) and (p1) of the Act apply for the land tax years 2004 to 2009 on the basis that 50% of the Wadalba property was managed according to the Department of Environment and Conservation for the protection of threatened species.

Factual background

4 The Tribunal had in addition to the documents filed by the Chief Commissioner pursuant to s 58 of the Administrative Decisions Tribunal Act 1997 ("the ADT Act"), the following other documents:

1.A number of submissions/statements/attachments filed by the applicant on various dates;
2.A bundle of documents produced by the respondent and labelled as "Respondent's evidence"; and
3.Written submissions by the respondent.

5 The facts not in dispute were as follows.
6 The applicant became owner of the Wadalba property on 22 March 2002 pursuant to orders made by Family Court of Australia on 6 March 2002. The Wadalba property situated on the Central Coast of New South Wales is approximately 4.05 hectares in area. On the property there is a three-bedroom house and a free standing corrugated iron "building". The two buildings are located in the middle of the Wadalba property. The rest of the Wadalba property is vacant land with natural vegetation.
7 The applicant is also an owner of a residential property situated in Telopea, which is a large three-storey brick building with a swimming pool, that had been her permanent residence for a number of years.
8 On 25 September 2002, the applicant entered into an exclusive management agency agreement with Coastwide Property Management Centre to lease the land. The house was let to tenants from sometime in 2002 until August 2007.
9 Sometime in June 2007 the garage connected to the house was damaged and on 17 July 2007 a fire destroyed the corrugated iron "building".
10 The last tenant vacated the house in August 2007 and no one has lived at the Wadalba property to date.
11 Electricity power to the corrugated iron "building" was disconnected on 8 August 2007 and all electricity connections to the Wadalba property were disconnected on 6 February 2008.
12 As the parties did not agree on several matters. I need to mention a few of the disputed facts by way of background to the outcome in this matter.
13 The corrugated iron "building" was described by the applicant as "non attached two bedroom unit". The Chief Commissioner described it as a "shed".
14 The applicant claimed that the Wadalba property was her residence since she has owned it. The applicant also claimed that the three bedroom "home and its immediate surroundings only, have been rented out" and that she has "always occupied the two bedroom unit".
15 The Chief Commissioner claimed that the applicant did not use the "shed" as her principal place of residence for various factual reasons. These included the following (footnotes for sources of information omitted):

"11. On 9 October 2002, the Applicant changed her address on the electoral roll to Wadalba. The Applicant claims that the Shed was her principal place of residence ( PPR ) from 1 January 2003 to 30 June 2007, despite its secluded location, no telephone connection, basic cooking, refrigeration and hot water system, hostile tenants, security issues, regular break-ins and vandalism and mail theft (including whole letterboxes).
12. From before 1 January 2003 to 24 January 2005, the electricity meter from the Shed was faulty and not correctly registering electricity consumption. On 19 January 2005, Energy Australia telephoned the Applicant to find out why there was only nominal electricity usage for the Shed and the Applicant responded that she was (in relation to Wadalba) "hardly ever here" and she was "only here on weekends and sometime through the week". After the meter was repaired, the reported electricity consumption for the unit from January 2005 until August 2007 was nominal and showed no material change from when the meter was faulty.
13. Photographs of Wadalba taken in late 2006 (aerial) and mid 2007 (ground level) showed the Shed surrounded by discarded machinery and rubbish. In letters written in June and July 2007, the Applicant and Dr. Haddad alleged that the tenant (Mr. ...(G)) had been using Wadalba, both the House and the surrounding land, for some time for business purposes as a demolition yard. Mr. ... (G)'s tenancy of Wadalba commenced in May 2005 and ended in or about August 2007.
14. In July 2006, the Applicant wrote to the Council and advised that Wadalba was "just a residential house".
15. During the Tax Years, the Applicant's mailing address for Council rates for Wadalba was listed as "PO Box 417 WEST RYDE 1685"
...
21. On 25 July 2007, the Applicant wrote to the Consumer, Trader and Tenancy Tribunal and sought an order (among other things) that the tenant pay for any damage caused to the "large steel garage".
22. On 7 August 2007, the Applicant wrote to the managing agent of Wadalba regarding "recent damage to the large steel shed at ... Johns Rd, Wadalba". In the letter, the Applicant stated that she had only become aware of the damage to the Shed after being shown photographs of the property taken by an employee of the managing agent sometime after the tree fell on the garage. The Applicant did not know when or how the damage to the Shed had occurred and asked the managing agent to investigate.
23. On 7 August 2007, the managing agent inspected Wadalba and wrote to the Applicant that the damage to the Shed appeared to have been caused by a fire.
24. The Applicant did not make a claim on her Allianz Building & Contents Insurance Policy for Wadalba for the damage to the Shed until 2 September 2010 and stated that the damage occurred on 22 July 2009.
25. The Applicant has provided the Respondent with copies of photographs she claims show the fire damage to the Shed. However, the Respondent has grave concerns whether these photographs are actually of the Shed, or were even taken at Wadalba, because (among other things) the burnt out structure shown in the photographs has fibro walls, while the photographs of the Shed taken by the managing agent show that it has metal (i.e. tin or galvanized iron) walls.
...
29. In or around July 2008, Wadalba was advertised for sale for $2.6 million with "future residential subdivision potential". Wadalba was described as "currently [having] a 3 bedroom brick and tile home and dual road access with all amenities close by, schools, public transport and new Coles Supermarket".
30. On 10 April 2010, the Applicant wrote to the Department of Lands that the best use of Wadalba "from 2003 to date is, as it is now, a single residence".
...
33. During the Tax Years, the Applicant owned land at ... Felton Street, Telopea (Telopea), which had a large three storey brick home erected on it with a swimming pool.
...
35. In April 2004 and January 2005, when the Applicant returned from two overseas trips, she stated on the Department of Immigration and Citizenship Incoming Passenger Card that her "intended address in Australia" was "... Felton Street, Telopea, NSW" and that her "Contact Details in Australia" were telephone number "96140687" and "... Felton Street, Telopea, NSW".
36. During the Tax Years, the Allianz Home Insurance Policy for Telopea held in the Applicant's name stated that she was the "Owner Occupier" of the Telopea property.
...
39. In January 2008, the Applicant applied to the Department of Fair Trading to claim the rental bond for Wadalba. On the application form, the Applicant stated that her home telephone number was "96140687".
...
41. During the Tax Years, the Applicant's address was listed as "... Felton Street, Telopea NSW 2117":

(a) on her driver's licence;
(b) by Parramatta City Council for mailing purposes; and
(c) on a company search and all annual Company Statements for Colerip Pty Limited (Company) of which the Applicant was a director, secretary and shareholder.

...
43. During the Tax Years, the Applicant's banking records show that she did her shopping at various suburbs in Sydney's north-west, including West Ryde, North Rocks, Carlingford, Baulkham Hills and Castle Hill. The banking records showed no shopping in the Wadalba area during the Tax Years. The Applicant claims that she made cash purchases in the Wadalba area during the Tax Years but has not provided any receipts or dockets to support her claim.
...
46. In August and October 2005, January and March 2006 and February and March 2008, the Applicant gave her address as "... Annangrove Road, Kenthurst, 2156" when opening various accounts with the Commonwealth Bank.
...
49. From early 2005, the Applicant claimed she provided extensive care for her sick mother, including sleeping many nights at her mother's house at ... Merelynne Avenue, West Pennant Hills as she required nightly assistance. The Applicant stated that her caring for her mother meant she was "spending less time at my home in Wadalba". Apart from a single hospital discharge sheet from July 2005, the Applicant has not provided any evidence as to the nature and extent (if any) of her mother's alleged sickness.
50. Prior to 7 April 2009, the Applicant verbally advised the Respondent that she had lived with her mother at ... Merelynne Avenue, West Pennant Hills since 2007.
...
52. On 31 August 2010, the Applicant's brother-in-law, Mr. ... , who has lived next door to ... Merelynne Avenue, West Pennant Hills for the past 12 years, advised the Respondent's inquiry agent that the Applicant did not live at ... Merelynne Avenue, West Pennant Hills during the Tax Years, but lived at Telopea before moving to Kenthurst or Dural.
...
57. On 16 July 2008, Parramatta City Council wrote to the Respondent and confirmed that the Applicant's mailing address was Telopea.
58. On 18 July 2008, Council sent a facsimile to the Respondent and confirming that the Applicant's mailing address was "PO Box 417, WEST RYDE, 1685".
59. On 21 July 2008, the Respondent obtained electricity search details for Wadalba which showed that electricity was connected to Wadalba in the name of:

(a) Mr. ... (R) (tenant) for the period 17 April 1998 to 29 March 2002;
(b) Mr. ... (E) (status not specified) for the period 10 June 2002 to 11 May 2005; and
(c) Mr. ... (G) (tenant) for the period 12 May 2005 to 14 December 2007.

60. On 30 July 2008, the Respondent conducted an internet search and determined that Wadalba was for sale for $2.6 million."

16 In response, the Applicant in her written submissions prepared by her agent made assertions disputing the Respondent's factual statements. The key assertions were as follows:

"11. Sally Haddad was not living in a shed. Within what appeared to be a corrugated steel shed, there was a separately roofed and insulated (walls and roof with six inch freezer panels) two bedroom comfortable unit.
Tab 25H, S.58D, shows pictures of the frame of the unit as well as pictures of metal parts of her furniture. Her unit had all comforts of any standard unit and was comfortable to live in.
Mr. ...(G) is the only tenant that posed a threat to Sally Haddad's safety and at that point (11-06-07), she turned to Jim Haddad for assistance and did not return to the property until Mr. ...(G) was forced to leave on 22-08-2007.
...
12. On the 19-01-2005, Energy Australia phoned Sally Haddad to investigate the nil registration on her Wadalba electricity meter. They indicate that Sally Haddad stated the following:
CUSTOMER ONLY HERE ON WEEKENDS AND SOMETIMES THROUGH THE WEEK, BUT METER NEVER REGISTERS CONSUMPTION.
This is further evidence that Sally Haddad occupied the unit on a regular basis. Sally Haddad is not claiming to have slept at Wadalba seven days per week. Calculations in her affidavit based on scientific knowledge show that she was there approximately seven days out of ten and this is supported by the above statement. In making this statement Sally Haddad was referring to her day time occupation of Wadalba as it would only have been during the day that she would have been able to view the meter and note that it was not registering.
...
If there was no record of electricity usage (as the meter was not registering) from 2001-2005 for Sally Haddad's unit, how can the Respondent claim that there was no material change in her usage after the meter was repaired in early 2005.
13. ...
Mr. ...(G) only appeared to be using the home and surroundings as a demolition yard towards the end of his tenancy (See TAB 25B, S.58D, and also see letter from principal agent inspection of 24-07-2007, P.260RE).
It should be noted that even though Sally Haddad's last day at her unit was the 11-06-2007, she continued to occupy the unit as it still housed her personal and living possessions, under lock and key.
...
18. The fire brigade note (sic) that the tin storage shed was completely destroyed by fire. If it was completely destroyed they would have difficulty identifying that it is a possible place of living. ...
...
27. At the directions hearing on 13-08-2010, Sally Haddad was questioned as to her PPR. She did not know what to answer. She asked "What determines a persons (sic) PPR," and she also stated that she had been staying at Wadalba. Apart from the electricity supply, Wadalba has been liveable for sometime and Sally Haddad had been staying there mainly at the weekends with the aid of a electricity generator. While repairs were being conducted she lived mostly with her parents and sometimes with her son. In the period from early June 2007 until her home at Wadalba became liveable, she lived mainly with her parents and this is why she replied at the hearing that she had lived with her parents.
...
29 The property was not for sale after late 2007. For some reason the agent continued to advertise it on the internet. ...
30. Considering all the re zonings of the Wadalba property and the problems in developing the property, its current best use is as a single residence.
31. The Wadalba property was rezoned to protect threatened species. If it is found that Wadalba is Sally Haddad's PPR then this issue is not important.
...
33. At one time, pre 1997, the Telopea residence housed the entire family and a home of that size was needed. After separation from Jim Haddad the house was too big for Sally Haddad to maintain alone. Even if she did not rent it to Jim Haddad's company she would not be able to stay there alone.
...
35. The intended address on the passenger card is not necessarily a persons (sic) PPR. If Sally Haddad had of (sic) given ... Johns Rd Wadalba as the address, anything sent to that address would likely to be lost. The phone number goes with the address. The occupants of ... Felton St, Telopea at any time would have been her children or husband and would have relayed any message to her.
...
38. The PO Box belongs to Jim Haddad (see P597 RE) and not Sally Haddad (sic) and should not have been produced as the summonses relate to Sally Haddad.
...
43. There was no need for Sally Haddad's shopping habits to change, just because she moved to Wadalba. She was still in Sydney on a regular basis because of work, the need to care for her mother and the need to visit her children and provide assistance if needed.
There are no shopping complexes at Wadalba. The shops at Wadalba provide only food items at a much higher price than large shopping centres. In any event she would have had to travel to shop. Any receipts she may have had, would have been destroyed when her unit burnt down in July 2007. ..."

Relevant Legislative Provisions

17 Land tax is payable by the owner of land upon the taxable value of the land owned by the owner as at midnight on 31 December immediately preceding the year for which the land tax is payable and which is not exempt from taxation under the Act.
18 Section 10 of the Act sets out various categories of land that enjoy exemption from land tax under the Act. Section 10, so far as it is relevant in relation to the "principal place of residence exemption", provides as follows:

" 10 Land exempted from tax
Except where otherwise expressly provided in the Act the
following lands shall, subject to sections 10B, 10D, 10E, 10G and 10P, be exempted from taxation under this Act:
...
land that is exempt from taxation under the principal place of residence exemption, as provided for by Schedule 1A."

19 Clause 2 of Schedule 1A of the Act, which sets out in detail the provisions dealing with the principal place of residence exemption at the relevant time, provided as follows:

"2 Principal place of residence exemption
Land used and occupied by the owner as the principal place of residence of the owner of the land, and for no other purpose, is exempt from taxation under this Act, in respect of the year commencing on 1 January 2004 or any succeeding year, if:
(a) the land has a land value in respect of the year of less than the premium tax threshold, and
(b) the land is:
(i) a parcel of residential land, or
(ii) a lot under the Strata Schemes (Freehold Development) Act 1973 or a lot under the Strata Schemes (Leasehold Development) Act 1986.
Land is not used and occupied as the principal place of residence of a person unless:
(a) the land and no other land, has been continuously used and occupied by the person for residential purposes and for no other purposes since 1 July in the year preceding the tax year in which land tax is levied, or
(b) in any other case, the Chief Commissioner is satisfied that the land is used and occupied by the person as the person's principal place of residence.
If the owner of land is entitled to the exemption conferred by this clause, no other person is liable to be assessed for taxation under this Act in respect of the land during the period of the owner's entitlement to the exemption.
The exemption conferred by this clause is referred to as the principal place of residence exemption.
(5) The principal place of residence exemption is subject to the restrictions set out in Part 4."

20 "Residential land" is defined in Clause 3 of Schedule 1A of the Act as follows:

"(1) In this Schedule, residential land means land that is used and occupied for residential purposes and for no other purpose, that use and occupation being use and occupation of a building or buildings designed, constructed or adopted for residential purposes, other than a building or buildings:
(a) comprised of lots within a strata plan or residential units, or
(b) containing (out of the total of all rooms in the building or buildings) occupancies other than that of the owner, or
(c) from any part of which income is derived.
(2) Land does not cease to be used and occupied as provided by subclause (1) by reason of there being on that land any building or improvement that is used or occupied for a purpose ancillary to the purposes for which the building is, or the building are, designed, constructed or adapted."

21 The exemption for land used and occupied, as a principal place of residence under clause 3, is only available for land used by the owner as one occupancy.
22 However, clause 4(1) of Schedule 1A provides a concession to owners where there is one other residential occupancy on the land other than that of the owner of the land provided it is an excluded residential occupancy under subclause (2). The residential occupancies excluded under subclause (2) are the following:

(a) one room,
(b) one suite of rooms (not being a flat) each room of which all occupants of the suite are entitled to occupy,
(c) one flat,
(d) one suite of rooms (not being a flat) each room of which all occupants of the suite are entitled to occupy, and one room,
(e) one flat and one room,
(f) 2 rooms, each of which is separately occupied.

23 Clause 4(3) of Schedule 1A further provides that "land does not cease to be residential land because there is on the land one, but not more than one, such excluded residential occupancy, even if income is derived from the residential occupancy".
24 A concession for land used for residential purposes and also for incidental business purposes is found in clause 5, which provides:

"(1) For the purposes of the principal place of residence exemption, if land owned by a person is used and occupied by the owner primarily for residential purposes but no more than one room is used primarily for business purposes, the use of the land for the purpose of the business may be disregarded if the business is primarily conducted elsewhere.
(2) Accordingly, land does not cease to be residential land because of the use of one room primarily for business purposes, even if income is derived from the use of the land for that purpose.
..."

25 The principal place of residence exemption is also available for land intended to be an owner's principal place of residence under clause 6, which is in the following terms:

" 6 Concession for unoccupied land intended to be owner's principal place of residence
(1) An owner of unoccupied land is entitled to claim the land as his or her principal place of residence, if the owner intends to use and occupy the land solely as his or her principal place of residence. In such a case, the owner is taken, for the purpose of the principal place of residence exemption, to use and occupy the unoccupied land as his or her principal place of residence. It is an offence under section 55 of the Taxation Administration Act 1996 to make a statement to a tax officer, or give information to a tax officer, orally or in writing, knowing that it is false or misleading in a material particular.
(2) This clause does not apply unless the Chief Commissioner is satisfied that:
(a) the land is unoccupied because the owner intends to carry out, or is carrying out, building or other works necessary to facilitate his or her intended use and occupation of the land as a principal place of residence, and
(b) if those building or other works have physically commenced on the land, no income has been derived from the use and occupation of the land since that commencement, and
(c) the intended use and occupation of the land is not unlawful.
(3) This clause applies in respect of the assessment of a person's ownership of land in the period of:
(a) 2 tax years immediately following the year in which the person became owner of the land, or
(b) if the land is used and occupied for residential purposes by a person other than owner at any time after the person became owner, 2 tax years immediately following the tax year in which the building or other works necessary to facilitate the owner's intended use and occupation of the land are physically commenced on the land.
(4) The Chief Commissioner may extend the period in which this clause applies if the owner of the unoccupied land demonstrates that:
(a) there is a delay in the completion or, in a case referred to in subclause (3)(b), the commencement of the building or other works necessary to facilitate the owner's intended use and occupation of the land, and
(b) the delay is due primarily to reasons beyond the control of the owner.
...
(8) For the purposes of this clause: "unoccupied land" means land that is not being used or occupied for any purpose."

26 Under Clause 8(1), a person absent from his or her principal place of residence is taken to continue to use and occupy that residence if the Chief Commissioner is satisfied that:

"(a) a person is the owner of land ( the former residence ) that has been used and occupied by the person as his or her principal place of residence for a continuous period of at least 6 months, and
(b) the person uses and occupies other land (whether or not in New South Wales), that is not owned by the person, as his or her principal place of residence."

27 Clause 8 further provides as follows:

"(2) The maximum period for which a person may be taken, under this clause, to continue to use and occupy a former residence as a principal place of residence is 6 years starting at the end of the last period (of at least 6 months) during which the former residence was used and occupied by that person as a principal place of residence (not including any period for which the person may be taken, under clause 7 or this clause, to have a used and occupied the former residence as a principal place of residence).
(3) If the principal place of residence exemption applies to the former residence of a person by operation of this clause, the exemption is revoked if the person is the owner of the former residence at the end of the 6-year period referred to in subclause (2) and fails:

(a) to resume actual use and occupation of the residence as a principal place of residence by the end of that period, and
(b) to continue that use and occupation for at least 6 months.

(4) The effect of that revocation is that the principal place of residence exemption is taken not to have applied to the former residence in respect of any tax year to which, but for the revocation would have applied. Land tax liability is to be assessed or reassessed accordingly.
(5) If the principal place of residence exemption is revoked, the reassessment of land tax liability more than 5 years after an initial assessment was made in respect of the land is authorised.

28 Clause 12 of Schedule 1A provides that for "the purposes of the principal place of residence exemption, only one place of residence may be treated as the principal place of residence of all members of the same family".
29 "Principal place of residence" of a person is defined in s 3(1) of the Act as "the one place of residence that is, among one or more places of residence of the person within or outside Australia, the principal place of residence of the person".
30 In this matter the applicant also claims that the following provisions apply:

10 Land exempted from tax
(1) Except where otherwise expressly provided in this Act the following lands shall ... be exempted from taxation under this Act:

(p) land that is the subject of a biobanking agreement under Part 7A of the Threatened Species Conservation Act 1995 [2007 - 2009 Land Tax Years]
(p1) land that, in accordance with approval of the Director-General of National Parks and Wildlife, is primarily used for the maintenance of endangered species native to Australia to assist their preservation [2004 Land Tax Year]
(p1) land that is the subject of a conservation agreement entered into under the National Parks and Wild life Act 1974 , if the primary purpose of the agreement is the maintenance of threatened species, populations or ecological communities (within the meaning of that Act) to assist their preservation [2005 Land Tax Year]
(p1) land that is the subject of a conservation agreement under the National Parks and Wildlife Act 1974 or a trust agreement registered as referred to in section 36 of the Nature Conservation Trust Act 2001 (2006 Land Tax Year]
(p1) land that is the subject of a conservation agreement under the HYPERLINK "http://www.legislation.nsw.gov.au/xref/inforce/?xref=Type%3Dact%20AND%20Year%3D1974%20AND%20no%3D80&nohits=y" National Parks and Wildlife Act 1974 , or a trust agreement registered as referred to in section 36 of the HYPERLINK "http://www.legislation.nsw.gov.au/xref/inforce/?xref=Type%3Dact%20AND%20Year%3D2001%20AND%20no%3D10&nohits=y" Nature Conservation Trust Act 2001 , being in either case an agreement that remains in force in perpetuity (that is, an agreement that remains in force for an indefinite period and that cannot be unilaterally terminated by the owner of the land) [2007 - 2009 Land Tax Years]

Submissions

31 The applicant made various submissions as to why she was entitled to the principal place of residence for the Wadalba property. The final position was set out in the written submissions made by her agent. The final submissions were made after the Tribunal brought to the attention of the applicant the difficulty the applicant faced in seeking the exemption in circumstances where the three-bedroom house had been let to tenants soon after she became the owner till August 2007. The applicant's agent in response to that concern submitted that -

"If the respondent is claiming that one dwelling is the house and the other is the flat, then the respondent would have some basis for doing that, and the Land Tax Management Act does not provide that basis. If there are two dwellings on one title, the Land Tax Management Act does not define the larger to be the house and the smaller to be the flat. The fact that Sally Haddad calls one the main home and the other unit, should not be seen as correct in terms of the land Tax Management Act. Sally Haddad is not an expert on defining dwellings. Sally Haddad in labelling the dwellings, is referring to the size of the dwellings, but the land Tax Management Act makes no distinction between the two dwellings with respect to size. Sally Haddad labels the three bedroom dwelling as the main home because it is larger than the two bedroom dwelling, however the Land Tax Management Act does not make that distinction or any other distinction that would allow the respondent to claim that she lived in the flat and the rented house."

32 It was further submitted that as from 22 August 2008, the Wadalba property was the applicant's principal place of residence by virtue of the provisions in clause 6 of Schedule 1A, which grants a concession for unoccupied land intended to be the owner's principal place of residence. In addition, some reliance was also placed on clause 8.
33 The applicant also submitted that she was entitled to an "exemption under Section 10(P1) for any year that land tax is payable because Wadalba is being used for the maintenance of threatened species and there is a conservation agreement between Wyong Council and the National Parks and Wildlife Service".
34 The Chief Commissioner's submissions were as follows:

" PPR exemption did not apply to Wadalba
102. As a threshold matter, the PPR exemption cannot apply to Wadalba in any Tax Year, regardless of whether or not it was the Applicant's PPR, if (as Applicant alleges) it had two separate dwellings on it ( McGrath and anor v Chief Commissioner of State Revenue [2007] NSWADT 46 at [50] - [55] and Chief Commissioner of State Revenue v McGrath [2008] NSWSC 387 at [48]). In such a case, because the House was not, by definition an "excluded residential occupancy" under cl. 4 of Schedule 1A. Wadalba was not a "parcel of residential land under cl. 3. Therefore, the PPR exemption under cl. 2 (which relevantly only applies to a parcel of residential land) could not apply to Wadalba for the 2004 to 2007 Tax Years, being the period that the Applicant claims that Wadalba had two separate dwellings on it.
103. Further, as no one lived at Wadalba after mid 2007, the PPR exemption under cl. 2 cannot apply to Wadalba for the 2008 and 2009 Tax Years, as it was not continuously used and occupied for residential purposes since 1 July 2007 and onwards.
104. Second, on the basis that Wadalba was used for business (i.e. non-residential) purposes during the period of Mr Guthrie's tenancy from May 2005 to August 2007, the PPR exemption under Cl. 2 could not apply to Wadalba for the 2006 to 2008 Tax Years, because cl 2 requires that land be used for residential purposes and no other purposes . Also on the basis that Wadalba, including the House, was the place where Mr. G...'s primarily conducted his "Complete Demolition" business, cl.5 of Schedule 1A does not assist the Applicant.
Wadalba not exempt under s.10(1)(p) of the Act
105. Third, s. 10(1)(p) (which was only in force for the 2007 and 2009 Tax Years) did not apply to Wadalba for the 2007 to 2009 Tax Years, because it was not the subject of a biobanking agreement under Part 7A of the Threatened Species Conservation Act 1995 .
Wadalba not exempt under s.10(1)(p1)
106. Fourth, s. 10(1)(p1) did not apply to Wadalba in any Tax Year, because it was not :

(a) for the 2004 Tax Year, land that, in accordance with approval of the Director-General of National Parks and Wildlife, was primarily used for the maintenance of endangered species native to Australia to assist their preservation;
(b) for the 2005 Tax Year, land that was the subject of a conservation agreement entered into under the National Parks and Wildlife Act 1974 ;
(c) for the 2006 Tax Year, land that was the subject of a conservation agreement under the National Parks and Wildlife Act 1974 , or a trust agreement registered as referred to in section 36 of the Nature Conservation Trust Act 2001 ; or
(d) for the 2007 to 2009 Tax Years, land that was the subject of a conservation agreement under the National Parks and Wildlife Act 1974 , or a trust agreement registered as referred to in section 36 of the Nature Conservation Trust Act 2001 , being in either case an agreement that remains in force in perpetuity."

35 It was also submitted that the applicant had not discharged the onus placed on her under s 100(3) of the Taxation Administration Act 1956 to establish that she had used the corrugated iron "building" as her principal place of residence.

Discussion and Reasons

36 The applicant's case was that she was entitled to the principal place of residence exemption for all the land tax years under review as provided by s 10(1)(r) of the Act on three different bases pursuant to the provisions found in Schedule 1A to the Act.
37 The first basis was that she was entitled to the exemption under clause 2 of Schedule 1A either by right under clause 2(2)(a) or, alternatively, the Chief Commissioner should have been satisfied under clause 2(2)(b) that the applicant had used and occupied the Wadalba property as her principal place of residence in all the land tax years under review.
38 The second basis advanced by the applicant was that she was entitled to the exemption in respect of the 2008 and 2009 land tax years under clause 6 to Schedule 1A because the Wadalba property was unoccupied land intended to be her principal place of residence.
39 The third basis was that the applicant was entitled to the exemption for some of the land tax years under clause 8 of Schedule 1A which allows an owner to retain the exemption for absences from a former principal place of residence.
40 The applicant also claimed that in respect for the land tax years 2004 to 2009 she was entitled to a reduction in land tax under sections 10(1)(p) and (p1) of the Act.
41 The scheme of the principal place of residence exemption as set out in Schedule 1A requires an owner to establish that "the land, and no other land, has been continuously used and occupied by the person for residential purposes and for no other purposes since 1 July in the year preceding the tax year in which land tax is levied". It is an essential requirement in order to qualify for the exemption. An owner not able to satisfy the requirement may be entitled to the exemption if "the Chief Commissioner is satisfied that the land is used and occupied by the person as the person's principal place of residence". Provisions dealing with the essential requirement are set out in clause 2(2)(a) of Schedule 1A and those dealing with the Chief Commissioner's discretion are found in clause 2(2)(b).
42 In Saboune and Another v Chief Commissioner [2011] NSWADT 8 I explained how these provisions apply as follows:

35 In the current provisions, Clause 2(2)(a) and (b), which are exactly in the same terms as s 3(3)(a) and (b) considered in Aldridge , there is no requirement that a determination must be made by the Chief Commissioner that the land was used and occupied as the principal place of residence of the owner as at midnight on 31 December of the preceding year. The provisions quite simply provide for a straightforward test for purposes of Clause 2(2)(a). Under this test, the owner of the relevant land will be entitled to the exemption provided it is the only land that has been continuously used and occupied by the owner for residential purposes and for no other purpose since 1 July in the year preceding the tax year in which land tax is levied. The words, "continuous use and occupation" must, of course, be read as explained by his Honour Gzell J in Flaracos v Chief Commissioner of State Revenue [2003] NSWSC 68 -

"28 The continuous use and occupation required by s 3(3)(a) of the Act means that the use of land for residential purposes must remain constant throughout each relevant eighteen month period. If portion of a residence is converted into a shop, the land no longer answers the description of continuous use for residential and no other purpose. The plaintiff's land having at all times been used as a dwelling, it satisfied this requirement.
29 In my opinion continuous physical presence on the land is not required to constitute continuous occupation. If a person leaves his or her premises for a holiday, it would defeat the purpose of the Act to conclude that occupation had ceased to be continuous. So long as the person retains the right to possession and controls possession, that person remains in occupation, in my view. The observation of Sir Nigel Bowen in Christie that physical presence over all the land is not necessary to establish occupation is equally apposite when there is some hiatus in physical presence over time."

36 It is also important to note that his Honour Gzell J explained that the test requires the determination to be made by having regard to the use and occupation of the land "throughout each relevant eighteen month period" and not just by considering the use and occupation as at midnight on the 31 December of the preceding year. The suggested approach in this matter is consistent with his Honour's observations.
37 On the other hand the provisions found in Clause 2(2)(b), provide that "in any other case" (emphasis added), the exemption is only available if "the Chief Commissioner is satisfied that the land is used and occupied by the person as the person's principal place of residence". In "any other case", would be a case where the owner has not continuously used and occupied the land for residential purposes and for no other purpose since 1 July in the year preceding the tax year in which the land tax is levied. Such a situation would arise in what was described in Flaracos as "hiatus in physical presence" over a short period with the owner surrendering the possession and control over the land during that period.
38 Neither provision requires the owner to satisfy the relevant provision as at midnight on 31 December in the preceding year. The Appeal Panel, by including that requirement, concluded that it was "not a true discretion". The discretion is broadly worded without any limitation. In the absence of any express direction in the relevant legislation as to how the discretion is to be exercised in a particular case, the decision-maker must be guided by the underlying purpose and policy "... so far that is manifested" in the relevant Acts: see Giris v Federal Commissioner of Taxation [1969] HCA 5; (1969) 119 CLR 365, Windeyer J at page 384. In Federal Commissioner of Taxation v G M Swift and Others [1989] FCA 413; 89 ATC 5101, French J (at page 5116) in considering a discretion of a similar nature stated that the "dispensing power is incidental and ancillary to the primary object of the legislation" and that its exercise must not "undermine the primary purpose" of "the scope and objects of the Act".
39 In Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; [1985-86] 162 CLR 24, Mason J (at 40) stated the approach to be taken when exercising a discretion of this nature as follows:

"... this court has held that, where a statute confers a discretion which in its terms is unconfined, the factors that may be taken into account in the exercise of the discretion are similarly unconfined, except in so far as there may be found in the subject matter, scope and purpose of the statute some implied limitation on the factors to which the decision-maker may legitimately have regard."

40 The Chief Commissioner considered his discretion as set out in s 3(3)(b) in his Revenue Ruling No. LT 20 (Principal Place of Residence) issued on 8 November 1989, which was replaced on 15 August 2008 by Revenue Ruling No. LT 82 (The Principal Place of Residence Exemption). ...
...
43 In my opinion a "true" discretion is given to the Chief Commissioner under Clause 2(2)(b). Historically, its predecessor provisions were available to the Chief Commissioner to attend to cases as suggested by the Chief Commissioner in his Revenue Ruling LT 20. But I agree with the submission made by the Chief Commissioner that it is a limited discretion in the context of the current provisions found in Schedule 1A to the Act. That is the case because since LT 20 was issued, the law relating to the principal place of residence exemption has been expanded and now there is a fairly comprehensive code in Schedule 1A. There are now a number of concessions in Schedule 1A that allow an owner to retain the exemption without fully satisfying the principal requirements set out in Clause 2(2)(a). For example, Clause 5 permits the owner to use one room of the principal place of residence for incidental business purposes and may derive income from this use. Clause 8 which permits an owner to retain the exemption when absent from the principal place of residence also allows the owner to derive income from "a lease, licence or other arrangement under which a person has a right to occupy the former residence and the total period for which any such right of occupation is conferred does not exceed 6 months in the tax year.
...

43 In this matter, there was no dispute that the Wadalba property had a three-bedroom house as the main residence. The disputed issue was whether there was also on the property, as claimed by the applicant, a two-bedroom flat. For purposes of the preliminary and essential requirement, it does not really matter if there was a two-bedroom flat because the three-bedroom house and its surrounding areas had been let at least from 2002 to sometime in August 2007. Because of the commercial letting of the main house the applicant was not entitled to the exemption under clause 2(2)(a). The Wadalba property had not "been continuously used and occupied " by the applicant "for residential (emphasis added) and for no other purposes since 1 July in the year preceding each of the 2004, 2005, 2006, and 2007 land tax years. The applicant was accordingly not entitled under clause 2(2)(a) to the exemption for the principal place of residence in respect of the Wadalba property for the 2004 to 2007 land tax years.
44 Next, it is necessary to consider whether the Chief Commissioner should have exercised the discretion given to him under clause 2(2)(b) for the land tax years under review. As explained in Saboune the discretion, although a true discretion, can only be exercised by the Chief Commissioner in very limited circumstances. In Saboune the Chief Commissioner only provided the circumstance where a person does not commence use and occupation by 1 July of the preceding year as one where the discretion may be exercised. That, of course, does not arise in this matter. The house situated on the Wadalba property had been rented out during the land tax years 2004 to 2007.
45 It should be noted that if the discretion had been exercised to grant the applicant exemption in the relevant land tax years, it would have clearly "undermined" the policy and scheme of the exemption, in particular clause 4. Clause 4 allows an owner to let part of the principal place of residence, provided it is an "excluded residential occupancy". Excluded residential occupancies are set out in clause 4(2). An owner is only entitled to the principal place of residence exemption if "there is on the land one, but no more than one, such excluded residential occupancy". In this matter, the applicant earned rental income during those land tax years and essentially used the house as an income-generating asset. The three-bedroom main house did not qualify as an excluded residential occupancy. The Chief Commissioner, in those circumstances, was entitled to refuse to exercise his discretion in this matter.
46 The applicant also placed reliance on clauses 6 and 8 of Schedule 1A.
47 Clause 6 which grants an owner of "unoccupied" land an exemption under Schedule 1A where the owner intends to use and occupy the land solely as his or her principal place of residence. In such a case, the owner is taken, for the purpose of the principal place of residence exemption, to use and occupy the unoccupied land as his or her principal place of residence. Clause 6 does not apply unless the Chief Commissioner is satisfied that:

(a) the land is unoccupied because the owner intends to carry out, or is carrying out, building or other works necessary to facilitate his or her intended use and occupation of the land as a principal place of residence, and
(b) if those building or other works have physically commenced on the land, no income has been derived from the use and occupation of the land since that commencement, and
(c) the intended use and occupation of the land is not unlawful.

48 But clause 6 applies in respect of the assessment of a person's ownership of land only in the period of:

(a) 2 tax years immediately following the year in which the person became owner, or
(b) if the land is used and occupied for residential purposes by a person other than the owner at any time after the person became owner, 2 tax years immediately following the tax year in which the building or other works necessary to facilitate the owner's intended use and occupation of the land are physically commenced on the land.

49 Clause 6 also does not apply in respect of land owned by a person if "the person or any member of the person's family (within the meaning of clause 12) is entitled to have his or actual use and occupation of other land taken into under section 9C" or under Schedule 1A.
50 In this matter the Wadalba property was not "unoccupied land". The applicant became owner of the Wadalba property on 6 March 2002 and in the land tax years 2004 to 2007 it was used to earn rental income. Clause 6 exemption was accordingly not available to the applicant for those years. It was claimed that the last tenant vacated the Wadalba property in August 2007. The applicant has produced very little evidence to show that any works to facilitate the owner's intended use and occupation of the property has commenced. In any case the exemption under clause 6 (4)(b) for the land tax years 2008 and 2009 would have only been available provided the works were completed by August 2009. Clearly, that has not happened on the applicant's own statement. The power to grant the applicant an extension under clause 6(4) can only be exercised if "the delay is primarily to reasons beyond the control of the owner". No such evidence was before the Tribunal. The applicant was also not entitled to the clause 6 exemption for the land tax years 2008 and 2009.
51 Clause 8 allows the owner of land to retain the principal place of residence exemption for absences from a former principal place of residence. The exemption only applies if the Chief Commissioner is satisfied that the owner has used and occupied his or her former principal place of residence "for a continuous period of at least 6 months" and has during the absences used and occupied any other land (whether or not in New South Wales), that is not owned by the person, as his or her principal place of residence. In this matter, as explained in relation to clause 2, the applicant was not entitled to the principal place of residence exemption for the 2004 to 2007 land tax years. During those years, even if as claimed by the applicant she used the iron corrugated "building", she could not establish that she used and occupied the Wadalba property for at least 6 months as her principal place of residence. Subsequent to the events that occurred in 2007 and after the last tenant left the Wadalba property, on her own statement, she has not occupied the Wadalba property.
52 The matter that remains is the claim made by the applicant that she was entitled to land tax exemption under s 10(1)(p) and (p1) of the Act. I agree with the submissions made by Mr Rider for the respondent as follows. In respect of the 2007 to 2009 land tax years, no exemption was available to the applicant because the Wadalba property was not "the subject of a biobanking agreement under Part 7A of the Threatened Species Conservation Act 1995 . In respect of the 2004 land tax years, the exemption under s 10(1)(p1) did not apply because no evidence was produced that the applicant had obtained an approval from the Director-General of National Parks and Wildlife to use the Wadalba property primarily "for the maintenance of endangered species native to Australia to assist their preservation". In respect of the 2005 to 2009 land tax years, the applicant was not entitled to an exemption as the Wadalba property was not land that was subject of a conservation agreement under the National Parks and Wildlife Act 1974 or a trust agreement registered as referred to in section 36 of the Nature Conservation Trust Act 2001 .
53 The application in this matter can be disposed of on the basis of the above rulings. I do not have to conclusively consider in any great deal of detail as to whether the applicant occupied the iron corrugated "building" and the nature of its use and occupation other than make the following passing comments. It is well settled law that to determine whether a residence is the principal place of residence of the owner it is necessary to use an objective test to ascertain the extent and quality of use and occupation of the residence in each case: Dean v Commissioner of Stamp Duties (Qld)(No2) [1996]2Qd R 557.
54 The onus to establish that the Wadalba property was the applicant's principal place of residence was under s 100(3) of the Taxation Administration Act 1996 on the applicant. The onus is usually discharged on the basis of various matters. It is important to note, as observed by the Victorian Civil and Administrative Tribunal in Re Ziino and Commissioner of State Revenue [2004] VCAT 1707 that:

"... while sleeping by itself in a place can be an indication of a principal place of residence, it is not the sole matter to be taken into account. One needs to look at a whole indicia of matters ...One needs to look as well at where the applicant ate; his use of electricity and the furniture and fittings and other matters such as entertainment of friends in the house... Sleeping in a place does not make a residence. It has got to be the whole indicia of things that are done in a home which are described in the cases..."

55 Other indicia include evidence of an applicant's use of the address of the property as the residential address for purposes of his or her mail, driving licence, on the electoral roll, in immigration records, income tax returns and telephone bills. In Chief Commissioner of State Revenue v Ferrington (GD) [2004] NSWADTAP 41 the Appeal Panel of the Tribunal agreed that "to occupy a home as his or her principal place of residence a person's occupation must have a degree of permanence to it: a connection to a place of residence of a transient, temporary, contingent or passing nature is not sufficient, nor occupation for any other reason". The Appeal Panel also held that "the intention of the person concerned, gauged objectively, is relevant but not determinative of the issue". (Also see Zakariya v Chief Commissioner of State Revenue [2003] NSWADT 26).
56 In this matter, the applicant did not give any evidence at the hearing nor did she produce any independent evidence to show that she had, in the years in issue, used and occupied the iron corrugated "building" as her principal place of residence. The claim was most unusual because the applicant not only owned another fairly large house where she claimed her children lived, she also was able to stay in great deal of comfort with her parents or one of her sons who occupied another property.
57 Mere spending some nights at the Wadalba property and sleeping in the iron corrugated "building" did not make the Wadalba property her principal place of residence. The evidence pointed to her reliance on her other property address for all correspondence and in dealing with various government agencies.
58 No friend or relative was produced to give evidence to suggest that the iron corrugated "building" was a place where the applicant had all her personal belongings and where she entertained her friends/relatives, cooked her meals and "spent the most time" (see Chief Commissioner of State Revenue v McIlroy [2009] NSWADTAP 21).
59 The applicant, in her submissions prepared by her agent, made a number of assertions. But no hard evidence was produced to suggest that she had abandoned her principal place of residence at Telopea and established it at the Wadalba property. On the contrary, the evidence was that she continued to have strong links with her own house and spent a considerable time at her parents' home. The corrugated iron "building" was not a place where the applicant spent most of her time. Evidence such as mobile phone records to show location of calls, was not produced to support her claim that she was at the property on a continuous basis. Her own evidence was that she spent some nights at this place.
60 The assessment is accordingly affirmed.

Order
The assessment for land tax years 2004 to 2009 is affirmed.
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URL: http://www.austlii.edu.au/au/cases/nsw/NSWADT/2011/17.html

1	The applicant has applied for a review of the Chief Commissioner's decision to assess land tax on land owned by the applicant and situated at Wadalba, New South Wales ("the Wadalba property") for the 2004 to 2009 land tax years ("the land tax years").
2	The applicant's case was that the Wadalba property was exempt from land tax in all the land tax years under the principal place of residence exemption found in s 10(1)(r) of the Land Tax Management Act 1956 ("the Act") as provided for in the various clauses of Schedule 1A to the Act. It was the applicant's case that she was entitled to the exemption under clause 2 which provides for the general exemption or under clause 6 which exempts unoccupied land intended to be owner's principal place of residence or under clause 8 for land previously used as a principal place of residence.
3	The applicant also claimed that the provisions of sections 10(1)(p) and (p1) of the Act apply for the land tax years 2004 to 2009 on the basis that 50% of the Wadalba property was managed according to the Department of Environment and Conservation for the protection of threatened species.

5	The facts not in dispute were as follows.
6	The applicant became owner of the Wadalba property on 22 March 2002 pursuant to orders made by Family Court of Australia on 6 March 2002. The Wadalba property situated on the Central Coast of New South Wales is approximately 4.05 hectares in area. On the property there is a three-bedroom house and a free standing corrugated iron "building". The two buildings are located in the middle of the Wadalba property. The rest of the Wadalba property is vacant land with natural vegetation.
7	The applicant is also an owner of a residential property situated in Telopea, which is a large three-storey brick building with a swimming pool, that had been her permanent residence for a number of years.
8	On 25 September 2002, the applicant entered into an exclusive management agency agreement with Coastwide Property Management Centre to lease the land. The house was let to tenants from sometime in 2002 until August 2007.
9	Sometime in June 2007 the garage connected to the house was damaged and on 17 July 2007 a fire destroyed the corrugated iron "building".
10	The last tenant vacated the house in August 2007 and no one has lived at the Wadalba property to date.
11	Electricity power to the corrugated iron "building" was disconnected on 8 August 2007 and all electricity connections to the Wadalba property were disconnected on 6 February 2008.
12	As the parties did not agree on several matters. I need to mention a few of the disputed facts by way of background to the outcome in this matter.
13	The corrugated iron "building" was described by the applicant as "non attached two bedroom unit". The Chief Commissioner described it as a "shed".
14	The applicant claimed that the Wadalba property was her residence since she has owned it. The applicant also claimed that the three bedroom "home and its immediate surroundings only, have been rented out" and that she has "always occupied the two bedroom unit".
15	The Chief Commissioner claimed that the applicant did not use the "shed" as her principal place of residence for various factual reasons. These included the following (footnotes for sources of information omitted):

17	Land tax is payable by the owner of land upon the taxable value of the land owned by the owner as at midnight on 31 December immediately preceding the year for which the land tax is payable and which is not exempt from taxation under the Act.
18	Section 10 of the Act sets out various categories of land that enjoy exemption from land tax under the Act. Section 10, so far as it is relevant in relation to the "principal place of residence exemption", provides as follows:

21	The exemption for land used and occupied, as a principal place of residence under clause 3, is only available for land used by the owner as one occupancy.
22	However, clause 4(1) of Schedule 1A provides a concession to owners where there is one other residential occupancy on the land other than that of the owner of the land provided it is an excluded residential occupancy under subclause (2). The residential occupancies excluded under subclause (2) are the following:

23	Clause 4(3) of Schedule 1A further provides that "land does not cease to be residential land because there is on the land one, but not more than one, such excluded residential occupancy, even if income is derived from the residential occupancy".
24	A concession for land used for residential purposes and also for incidental business purposes is found in clause 5, which provides:

28	Clause 12 of Schedule 1A provides that for "the purposes of the principal place of residence exemption, only one place of residence may be treated as the principal place of residence of all members of the same family".
29	"Principal place of residence" of a person is defined in s 3(1) of the Act as "the one place of residence that is, among one or more places of residence of the person within or outside Australia, the principal place of residence of the person".
30	In this matter the applicant also claims that the following provisions apply:

32	It was further submitted that as from 22 August 2008, the Wadalba property was the applicant's principal place of residence by virtue of the provisions in clause 6 of Schedule 1A, which grants a concession for unoccupied land intended to be the owner's principal place of residence. In addition, some reliance was also placed on clause 8.
33	The applicant also submitted that she was entitled to an "exemption under Section 10(P1) for any year that land tax is payable because Wadalba is being used for the maintenance of threatened species and there is a conservation agreement between Wyong Council and the National Parks and Wildlife Service".
34	The Chief Commissioner's submissions were as follows:

36	The applicant's case was that she was entitled to the principal place of residence exemption for all the land tax years under review as provided by s 10(1)(r) of the Act on three different bases pursuant to the provisions found in Schedule 1A to the Act.
37	The first basis was that she was entitled to the exemption under clause 2 of Schedule 1A either by right under clause 2(2)(a) or, alternatively, the Chief Commissioner should have been satisfied under clause 2(2)(b) that the applicant had used and occupied the Wadalba property as her principal place of residence in all the land tax years under review.
38	The second basis advanced by the applicant was that she was entitled to the exemption in respect of the 2008 and 2009 land tax years under clause 6 to Schedule 1A because the Wadalba property was unoccupied land intended to be her principal place of residence.
39	The third basis was that the applicant was entitled to the exemption for some of the land tax years under clause 8 of Schedule 1A which allows an owner to retain the exemption for absences from a former principal place of residence.
40	The applicant also claimed that in respect for the land tax years 2004 to 2009 she was entitled to a reduction in land tax under sections 10(1)(p) and (p1) of the Act.
41	The scheme of the principal place of residence exemption as set out in Schedule 1A requires an owner to establish that "the land, and no other land, has been continuously used and occupied by the person for residential purposes and for no other purposes since 1 July in the year preceding the tax year in which land tax is levied". It is an essential requirement in order to qualify for the exemption. An owner not able to satisfy the requirement may be entitled to the exemption if "the Chief Commissioner is satisfied that the land is used and occupied by the person as the person's principal place of residence". Provisions dealing with the essential requirement are set out in clause 2(2)(a) of Schedule 1A and those dealing with the Chief Commissioner's discretion are found in clause 2(2)(b).
42	In Saboune and Another v Chief Commissioner [2011] NSWADT 8 I explained how these provisions apply as follows:

43	In this matter, there was no dispute that the Wadalba property had a three-bedroom house as the main residence. The disputed issue was whether there was also on the property, as claimed by the applicant, a two-bedroom flat. For purposes of the preliminary and essential requirement, it does not really matter if there was a two-bedroom flat because the three-bedroom house and its surrounding areas had been let at least from 2002 to sometime in August 2007. Because of the commercial letting of the main house the applicant was not entitled to the exemption under clause 2(2)(a). The Wadalba property had not "been continuously used and occupied " by the applicant "for residential (emphasis added) and for no other purposes since 1 July in the year preceding each of the 2004, 2005, 2006, and 2007 land tax years. The applicant was accordingly not entitled under clause 2(2)(a) to the exemption for the principal place of residence in respect of the Wadalba property for the 2004 to 2007 land tax years.
44	Next, it is necessary to consider whether the Chief Commissioner should have exercised the discretion given to him under clause 2(2)(b) for the land tax years under review. As explained in Saboune the discretion, although a true discretion, can only be exercised by the Chief Commissioner in very limited circumstances. In Saboune the Chief Commissioner only provided the circumstance where a person does not commence use and occupation by 1 July of the preceding year as one where the discretion may be exercised. That, of course, does not arise in this matter. The house situated on the Wadalba property had been rented out during the land tax years 2004 to 2007.
45	It should be noted that if the discretion had been exercised to grant the applicant exemption in the relevant land tax years, it would have clearly "undermined" the policy and scheme of the exemption, in particular clause 4. Clause 4 allows an owner to let part of the principal place of residence, provided it is an "excluded residential occupancy". Excluded residential occupancies are set out in clause 4(2). An owner is only entitled to the principal place of residence exemption if "there is on the land one, but no more than one, such excluded residential occupancy". In this matter, the applicant earned rental income during those land tax years and essentially used the house as an income-generating asset. The three-bedroom main house did not qualify as an excluded residential occupancy. The Chief Commissioner, in those circumstances, was entitled to refuse to exercise his discretion in this matter.
46	The applicant also placed reliance on clauses 6 and 8 of Schedule 1A.
47	Clause 6 which grants an owner of "unoccupied" land an exemption under Schedule 1A where the owner intends to use and occupy the land solely as his or her principal place of residence. In such a case, the owner is taken, for the purpose of the principal place of residence exemption, to use and occupy the unoccupied land as his or her principal place of residence. Clause 6 does not apply unless the Chief Commissioner is satisfied that:

49	Clause 6 also does not apply in respect of land owned by a person if "the person or any member of the person's family (within the meaning of clause 12) is entitled to have his or actual use and occupation of other land taken into under section 9C" or under Schedule 1A.
50	In this matter the Wadalba property was not "unoccupied land". The applicant became owner of the Wadalba property on 6 March 2002 and in the land tax years 2004 to 2007 it was used to earn rental income. Clause 6 exemption was accordingly not available to the applicant for those years. It was claimed that the last tenant vacated the Wadalba property in August 2007. The applicant has produced very little evidence to show that any works to facilitate the owner's intended use and occupation of the property has commenced. In any case the exemption under clause 6 (4)(b) for the land tax years 2008 and 2009 would have only been available provided the works were completed by August 2009. Clearly, that has not happened on the applicant's own statement. The power to grant the applicant an extension under clause 6(4) can only be exercised if "the delay is primarily to reasons beyond the control of the owner". No such evidence was before the Tribunal. The applicant was also not entitled to the clause 6 exemption for the land tax years 2008 and 2009.
51	Clause 8 allows the owner of land to retain the principal place of residence exemption for absences from a former principal place of residence. The exemption only applies if the Chief Commissioner is satisfied that the owner has used and occupied his or her former principal place of residence "for a continuous period of at least 6 months" and has during the absences used and occupied any other land (whether or not in New South Wales), that is not owned by the person, as his or her principal place of residence. In this matter, as explained in relation to clause 2, the applicant was not entitled to the principal place of residence exemption for the 2004 to 2007 land tax years. During those years, even if as claimed by the applicant she used the iron corrugated "building", she could not establish that she used and occupied the Wadalba property for at least 6 months as her principal place of residence. Subsequent to the events that occurred in 2007 and after the last tenant left the Wadalba property, on her own statement, she has not occupied the Wadalba property.
52	The matter that remains is the claim made by the applicant that she was entitled to land tax exemption under s 10(1)(p) and (p1) of the Act. I agree with the submissions made by Mr Rider for the respondent as follows. In respect of the 2007 to 2009 land tax years, no exemption was available to the applicant because the Wadalba property was not "the subject of a biobanking agreement under Part 7A of the Threatened Species Conservation Act 1995 . In respect of the 2004 land tax years, the exemption under s 10(1)(p1) did not apply because no evidence was produced that the applicant had obtained an approval from the Director-General of National Parks and Wildlife to use the Wadalba property primarily "for the maintenance of endangered species native to Australia to assist their preservation". In respect of the 2005 to 2009 land tax years, the applicant was not entitled to an exemption as the Wadalba property was not land that was subject of a conservation agreement under the National Parks and Wildlife Act 1974 or a trust agreement registered as referred to in section 36 of the Nature Conservation Trust Act 2001 .
53	The application in this matter can be disposed of on the basis of the above rulings. I do not have to conclusively consider in any great deal of detail as to whether the applicant occupied the iron corrugated "building" and the nature of its use and occupation other than make the following passing comments. It is well settled law that to determine whether a residence is the principal place of residence of the owner it is necessary to use an objective test to ascertain the extent and quality of use and occupation of the residence in each case: Dean v Commissioner of Stamp Duties (Qld)(No2) [1996]2Qd R 557.
54	The onus to establish that the Wadalba property was the applicant's principal place of residence was under s 100(3) of the Taxation Administration Act 1996 on the applicant. The onus is usually discharged on the basis of various matters. It is important to note, as observed by the Victorian Civil and Administrative Tribunal in Re Ziino and Commissioner of State Revenue [2004] VCAT 1707 that:

55	Other indicia include evidence of an applicant's use of the address of the property as the residential address for purposes of his or her mail, driving licence, on the electoral roll, in immigration records, income tax returns and telephone bills. In Chief Commissioner of State Revenue v Ferrington (GD) [2004] NSWADTAP 41 the Appeal Panel of the Tribunal agreed that "to occupy a home as his or her principal place of residence a person's occupation must have a degree of permanence to it: a connection to a place of residence of a transient, temporary, contingent or passing nature is not sufficient, nor occupation for any other reason". The Appeal Panel also held that "the intention of the person concerned, gauged objectively, is relevant but not determinative of the issue". (Also see Zakariya v Chief Commissioner of State Revenue [2003] NSWADT 26).
56	In this matter, the applicant did not give any evidence at the hearing nor did she produce any independent evidence to show that she had, in the years in issue, used and occupied the iron corrugated "building" as her principal place of residence. The claim was most unusual because the applicant not only owned another fairly large house where she claimed her children lived, she also was able to stay in great deal of comfort with her parents or one of her sons who occupied another property.
57	Mere spending some nights at the Wadalba property and sleeping in the iron corrugated "building" did not make the Wadalba property her principal place of residence. The evidence pointed to her reliance on her other property address for all correspondence and in dealing with various government agencies.
58	No friend or relative was produced to give evidence to suggest that the iron corrugated "building" was a place where the applicant had all her personal belongings and where she entertained her friends/relatives, cooked her meals and "spent the most time" (see Chief Commissioner of State Revenue v McIlroy [2009] NSWADTAP 21).
59	The applicant, in her submissions prepared by her agent, made a number of assertions. But no hard evidence was produced to suggest that she had abandoned her principal place of residence at Telopea and established it at the Wadalba property. On the contrary, the evidence was that she continued to have strong links with her own house and spent a considerable time at her parents' home. The corrugated iron "building" was not a place where the applicant spent most of her time. Evidence such as mobile phone records to show location of calls, was not produced to support her claim that she was at the property on a continuous basis. Her own evidence was that she spent some nights at this place.
60	The assessment is accordingly affirmed.