It recently emerged from Bruce Lehrmann’s defamation case in the Federal Court of Australia that Lehrmann received 12 months’ accommodation, potentially valued at $130,000, in exchange for his “bombshell interview” with Spotlight. An executive producer at Channel 7 previously claimed that “no one was paid” for the interview. The court has published an invoice issued by the accommodation provider and the agreement between Seven and Lehrmann, which says:

In consideration of the Interviewee complying in full with the terms and warranties of this Agreement and for the contribution of his time, Seven will provide the Interviewee 12 months accommodation at a residence to be agreed by Seven and the Interviewee. The residence may be used by Seven to arrange and film any parts of the Seven Exclusive.

Assume that Seven did pay $130,000 for Lehrmann’s rent over the course of a financial year, without notifying Lehrmann of each payment. Seven would presumably deduct this as a business expense. However, the terms of the contract and one-off nature of the deal count against Lehrmann becoming an employee of Seven, which seems to mean that housing fringe benefits tax would not apply. And since Seven isn’t paying Lehrmann directly, it doesn’t seem to be required to withhold tax until Lehrmann provides an ABN.

So does Lehrmann have to pay income tax on the $130,000? Assume that he isn’t running an ongoing business as an interview subject, which would require him to report that business’s non-cash income – he never gives another interview. As a result of entering the contract with Seven, is Lehrmann required to apply for an ABN and report the market rent as income in a business activity statement, or include it as income in his personal tax return?

  • "Does the contract with Seven itself require...": Do you mean to ask whether this is a term of the contract or whether the existence of the contract (or of the payments agreed by that contract) trigger this obligation under tax law or some other law? Also, for those of us following at a distance, what's an ABN?
    – phoog
    Commented Dec 5, 2023 at 10:05
  • The latter – I've edited the question. An ABN is an Australian Business Number, which is required to issue tax invoices and receive payment for services without tax being withheld. But Lehrmann didn't need to issue an invoice or receive payment.
    – sjy
    Commented Dec 5, 2023 at 11:53
  • 1
    Key question would be was the residence for his sake or for Sevens? They have (per the quoted agreement) the right to use it as a shooting location.
    – jmoreno
    Commented Dec 6, 2023 at 3:42

1 Answer 1



Barter transactions are taxable. Seven is providing Mr Lehrman with accomodation, reported to be worth $180,000, in return for exclusive rights to his story. Apart from the barter element, this is a straightforward business contract. The trick with a barter deal is to temper that there are two taxable transactions here; each party being the supplier in one of them.

Mr Lehrman is in business - the agreement with Seven is not a one-off transaction as it is intended to last a year and requires both parties to provide their consideration over that time.

The supply of the story is a supply subject to Goods and Services Tax (GST). Because the value of his income from that, including barter, is above $75,000 (excluding GST), he is required to register for (GST) and necessarily will have an Australian Business Number (ABN) because you can’t have get the former without the latter. He will be required to provide Seven with a tax invoice (one big one, or several smaller ones) for the value of the payment he receives. From this, he will remit the GST (about $16.5k) and income taxes (between about $64k to $80k, depending on his tax bracket). Seven will reduce their GST and income tax liabilities by the amounts on Mr Lehrman’s tax invoice(s); which should be for the fair market value.

At the same time, Seven is a supplier to Mr Lehrman. Residential property is an input-taxed supply, so there is no GST payable and no requirement to issue a tax invoice. However, the value of the property ($180,000) is income to Seven, and they will pay company tax of $60,000 on this.

Seven’s cost of owning the property, or renting it from a third party, is outside the scope of the transaction between Seven and Mr Lehrman as it is another transaction(s). Briefly, any GST is not claimable as it was used for making an input-taxed supply, but the costs will be expenses that will reduce taxable income. If they are exactly $180,000, they will exactly offset the supply's value to Mr Lehrman; however, it’s more likely Seven will make a profit or loss on the property.

Similarly, the income Seven makes from disseminating the story is a whole other group of transactions and is likely indirect as it will come from advertising and subscriptions and will not be directly attributable to any one story during the year. Unlike manufacturers, wholesalers, and retailers, media businesses do not have a direct link between their input costs and their revenues.

For completeness, let's assume this was a one-and-done deal, Mr Lehrman gives one interview, and Seven gives him a place to live for a year. He is not running a business and is not required to register for GST or have an ABN.

This is now a purely personal transaction for Mr Lehrman, but it is still assessable income as it is payment for providing a service. Therefore, his income for the year will be $180,000 higher, and he will owe income tax of between $66,600 and $84,600.

It's still a sale for Seven, and this analysis is identical.


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