In 2003 the Australian Federal Court held that an Australian javelin thrower was not carrying on a business (next to her employment with the Queensland Police Force), and that hence price money and grants were not subject to income tax. In Stone v FCT ( FCAFC 145) the Federal Court did decide that that appearance fees and sponsorship payments were payments for services and therefore subject to income tax.
On 26 April 2005 the Australian High Court (in Commissioner of Taxation vs. Stone  HCA 21) dealt with this case, and held that also prize money and grants were subject to income tax. According to press reports, the High Court held that the athletic activities of the athlete constituted the operation of a business and that therefore all money received is subject to income tax.
In a contribution to the journal Tax Notes International Prof. Richard Krever (of Monash University Melbourne) held that it is unclear whether the decision will have strong precedential value. Prof. Krever mentions that it is unusual for the High Court to accept an appeal in such a factual case, and he suspects that the reason for the High Court to deal with the case was the Australian national passion for all things related to sports.