Federal Commissioner of Taxation v Peabody was a 1994 High Court of Australia tax case concerning certain transactions made by the Peabody family business. The Australian Taxation Office (ATO) sought to apply the Part IVA general anti-avoidance provisions of the Income Tax Assessment Act 1936.
The case was decided in favour of the taxpayer Mary Peabody, on the slightly technical grounds that there wasn't a reasonable expectation she would have received the income in question (from the family trust) in the year and under the interpretation asserted by the ATO.
The significance of the case today, and the reason it's frequently cited, is principally its place in judicial interpretation of Part IVA. The ATO in particular didn't regard the case as a complete loss, they took remarks in the judgements as confirming their interpretation of that legislation.
Read more about Federal Commissioner Of Taxation V Peabody: Transaction, Assessment and Court
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