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04 Jun 2014
Appeal Status
Not appealed

Statement of position declared invalid

2014 case note - respondent's Statement of Position was considered invalid and respondent unable to challenge the assessments - prescribed form.

TRA 007/13 [2014] NZTRA 05


The respondent's Statement of Position ("SOP") was considered invalid and the respondent was therefore unable to challenge the assessments under Part 8A of the Tax Administration Act 1994 ("TAA").

Impact of decision

It is not enough for a SOP to be filed in the prescribed form (IR773). It must also meet the requirements of section 89M(6) of the TAA.


The Commissioner of Inland Revenue ("the Commissioner") applied to strike out the respondent's Notice of Claim on the ground that the Notice of Claim discloses no right of challenge under Part 8A of the TAA and therefore should be struck out pursuant to section 138H of the TAA.

The respondent is a taxi driver and disputes the Commissioner's GST and income tax assessments for various income years. On 24 September 2012, the Commissioner issued the respondent a disclosure notice which provided that the respondent had two months from the date of the disclosure notice to issue a SOP.

On 11 October 2012, the respondent issued a document in the prescribed form (IR773) for a SOP. The document contained very little information.

On 16 October 2012, the Commissioner advised the respondent by letter that she was of the view that the document purporting to be a SOP did not meet the legislative requirements in section 89M(6) of the TAA. The Commissioner requested that the respondent supply additional information or a new SOP by 23 November 2012. The respondent did not do so.


The Taxation Review Authority ("TRA") agreed with the Commissioner's submission that the respondent's SOP did not contain sufficient detail to fairly inform the Commissioner of the facts, evidence and propositions of law on which the respondent relied. The TRA found that the SOP was therefore in breach of section 89M(6) of the TAA. The TRA considered that at best it was "a bare outline of matters".

Consequently, the TRA found that the respondent had not issued a valid SOP in the prescribed form within the requisite response period. Accordingly, the respondent was deemed not to have issued a Notice of Proposed Adjustment pursuant to section 89M(7)(b).

The TRA also agreed with the Commissioner's submission that a taxpayer cannot rely solely on filing the IR773 for the purposes of section 89M(7) of the TAA without complying with the requirements of section 89M(6), as this would have the effect of making section 89M(6) redundant. The TRA stated further that section 89M(6) is mandatory.

Accordingly, the TRA decided that, as the respondent had failed to follow the disputes procedure, the Commissioner's assessments are deemed correct under section 109 of the TAA and section 138B of the TAA provides that the respondent is unable to challenge the Commissioner's assessments under Part 8A.

Tax Administration Act 1994