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The ATO has issued a Decision Impact Statement in relation to the Full Federal Court decision in FCT v Multiflex Pty Ltd [2011] FCAFC 142.

The case concerned whether the Commissioner has an implied reasonable time to refund or credit an amount under s 35-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).

The Court held that the reasonable time in which the Commissioner must perform the duty under s 35-5 of the GST Act was a period not longer than required for administrative processing of a GST return. The trial judge's order that the Commissioner pay Multiflex the GST refunds forthwith was upheld.

The Court indicated that if the Commissioner knows the amount stated in the GST return is wrong, he can raise an assessment which would supersede the net amount stated in the return.

On 9 December 2011, the High Court refused the Commissioner special leave to appeal against the Full Court's decision.

The ATO says it is considering what administrative practices may be reviewed as a result of the decision.

 On 12 December 2011, the ATO sent a broadcast message to tax agents, in which the ATO says that it "will progressively release all affected activity statement refunds as soon as administratively possible" to clients awaiting refunds.


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