Bywater Investments Ltd v. Federal Commissioner of Taxation

Holding

Central management and control of a company is exercised where the real decision-making occurs, not necessarily where directors formally meet.

Facts

Bywater Investments and related companies were nominally controlled by Swiss directors but actually directed by a Sydney-based individual.

Reasoning

The High Court of Australia confirmed the central-management-and-control test focuses on substance rather than form. The decision affects Australian tax residency analysis for foreign-incorporated entities with Australian-based decision-makers.