Fax Delivery of CIR's Statement of Position is Within Time

Harris v CIR & TRA [2014] NZHC 151
The High Court has confirmed that a statement of position which was issued by the Commissioner to a taxpayer by fax was issued within the statutory response period. The taxpayer applied for judicial review of a preliminary decision of the Taxation Review Authority that held the SOP had been delivered in time. Had it not been then, by default, the tax dispute could have been resolved in the taxpayer’s favour.
The taxpayer’s application was denied on several grounds including the fact that judicial review was not appropriate to the issue. The Court considered that the review was in substance an appeal on the preliminary point. It noted that the point was susceptible to appeal to the High Court, should the substantive matter be decided against the taxpayer. In other words the taxpayer could have his day in court over the preliminary point, just not yet!
As to the point decided by the TRA, the Court declined to follow the taxpayer’s arguments. The Commissioner’s state of position had been sent by fax to the taxpayer’s agent at 11.07 pm on the last day of the response period and an original of the notice was put in the post on the same evening at 11.25.
The taxpayer argued that the Commissioner was not permitted to provide documents by electronic means. He argued in effect that section 14 of the Tax Administration Act, which permits this, did not apply to his case because it had commenced before the express permission was introduced into that section. This was a forlorn argument and the TRA decision that section 14 applied to new and existing matters was upheld.
An argument that the High Court Rules determined the timing of delivery of the statement was also rejected. The Rule which stipulates that service undertaken by electronic means after 5 pm is deemed to occur the day after, was not relevant because the statement of position was not being served under the Rules.
A third argument that the timing of delivery of the statement had to take account of the point at which it might reasonably have come to the taxpayer’s notice was rejected. It was sufficient that the electronic document was transmitted within the time required for it to be issued by the Commissioner and that there was not reasonable basis for thinking that the taxpayer would not receive it.
The decision cuts both ways. It supports the fact that taxpayers, who must also meet sudden death deadlines under the TAA, can provide notices to the Commissioner at any time up to the end of the last day of the relevant response period. Where a notice must be issued and time is short it is wise to provide it to the Commissioner by email attachment, fax and to confirm that the original has been placed in the post before the expiry of the response period.
© G D Clews, 2014       

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