tax law


see the attached


The term ‘incurred’ is one of the most controversial in Australian taxation law.  As defined in section 8-1 of the Income Tax Assessment Act 1997, the term requires outgoings to be ‘incurred’ as an important prerequisite to deductibility.[1]  The Australia common law has a number of judicial observations regarding the meaning of this term. The importance of this controversial is exemplified by the high number of High Court judgments on the meaning of the term.  This study therefore looks at the meaning of this term in light of the cases and statues.

According to section 8-1, one must have incurred outgoings in order to qualify for tax deduction.  There is not statutory definition of the term ‘incurred’. Broadly speaking, an outlining will be incurred when one owes present money debt that one is not in a position to escape.[2] However, the major challenge has been inclusion of this broad guide.

[1] Income Tax Assessment Act 1997

[2] Woellner, Robin, Barkoczy, Stephen, Murphy, Shirley, Evans, Chris, and Pinto, Dale. Australian Taxation Law Select: legislation and commentary.( CCH Australia, Sydney, NSW. 2014)