National Australia Bank will seek a Federal Court ruling to overturn adverse tax assessments by the Australian Taxation Office over hybrid securities (exchangeable capital units, or ExCap) originally sold in 1997.
NAB filed the case yesterday,
The Age reported. The bank foreshadowed the legal action in early September.
Two months ago the bank said it decided to write down to nil the carrying value of $309 million in receivables considered due from the ATO over the ExCaps dispute. This did not affect cash earnings for the bank's financial year to September 2009.
The amount relates to the 50 per cent payment of disputed tax over the ExCaps and paid to the ATO some years ago.
The ATO considers that NAB owes it another $309 million, though NAB is unlikely to pay this unless ordered to do so by the court.