Federal Court proceedings to consider the application of super legislation to allow investment in the DomaCom fund by an SMSF where a related party is the tenant in an underlying property have come to a close.
Fractional property investment company DomaCom said the ATO had until 7 September to file an application with the High Court for special leave if it was to appeal the decision of the Federal Court of Appeal, unless an extension of time was granted by the High Court.
DomaCom said it had been advised by its lawyers no such appeal or application for an extension of time had been filed.
The Federal Court last week issued orders that there be a declaration the leasing of the Burwood property by the DomaCom fund would not cause Aussiegolfa Pty Ltd as trustee of the Benson Fund to breach the sole purpose test set out in section 62 of the Superannuation Industry (Supervision) Act 1993.
The orders also stated Aussiegolfa should pay 40 per cent of the ATO’s costs of the first instance proceeding, as agreed or otherwise assessed, and it should pay 40 per cent of the tax office’s costs of the appeal, as agreed or otherwise assessed.
The court ordered the ATO pay 100 per cent of Aussiegolfa’s costs in relation to the Administrative Appeals Tribunal appeal.
DomaCom said the above costs were being calculated and it will announce the net payment in due course should it be material.
DomaCom chief executive Arthur Naoumidis said: “DomaCom will now focus on addressing the related trust matter and is reviewing our constitution and disclosure documents to address this issue with respect to future sub-funds.”
