Latest News

Hot Issues
spacer
Resources to help understand and implement Single Touch Payroll (STP)
spacer
Big fines, prison on the cards as new SG penalties introduced
spacer
Extra website resources and tools is one way we offer you and your family more.
spacer
FBT Exemption for Various Work Vehicles
spacer
Tax payable on expenditure recoupments
spacer
ATO identifies SMSF contravention red flags
spacer
Who wins dispute about taxable income?
spacer
Australia - facts & figures March 2019
spacer
Strategies to handle scam phone calls and problem e-mails.
spacer
Instant asset write-off threshold upped to $25k
spacer
Jail time for GST fraud
spacer
Correcting GST Errors
spacer
Fuel tax credit rates raised
spacer
ATO set to contact clients for overdue TPAR
spacer
Reminder on Victoria Property Duties
spacer
How Australia is performing.
spacer
Global outlook summary: Down but not out
spacer
Bookkeepers remind on incoming TPRS obligations
spacer
Golden Rules for Deductions
spacer
How's Australia going - vital statistics?
spacer
Tax, SMEs set to be ‘political football’ in 2019 as election nears
spacer
Cap lifted on popular financing option for clients
spacer
Expiry of 900,000 interest-only loans set for January
spacer
Australian Taxation Office (ATO) Scam Alert: Fake Demands for Tax Payments
spacer
Tax Office sounds alarm on popular property strategy
spacer
Our Advent calendar for 2018
spacer
‘Please do not panic’: ATO boss addresses STP concerns
Article archive
spacer
Quarter 4 October - December 2018
spacer
Quarter 3 July - September 2018
spacer
Quarter 2 April - June 2018
spacer
Quarter 1 January - March 2018
spacer
Quarter 4 October - December 2017
spacer
Quarter 3 July - September 2017
spacer
Quarter 2 April - June 2017
spacer
Quarter 1 January - March 2017
spacer
Quarter 4 October - December 2016
spacer
Quarter 3 July - September 2016
spacer
Quarter 2 April - June 2016
spacer
Quarter 1 January - March 2016
spacer
Quarter 4 October - December 2015
spacer
Quarter 3 July - September 2015
spacer
Quarter 2 April - June 2015
spacer
Quarter 1 January - March 2015
spacer
Quarter 4 October - December 2014
Tax assessments confirmed for undisclosed business income

The increasing cost of underreporting and failing to lodge.

       

 

The Administrative Appeals Tribunal has ruled that the Australian Taxation Office (ATO) was correct to issue tax assessments of $3.7 million and penalties of $3.3 million to a business taxpayer that had underreported its income and failed to lodge several year returns.

The taxpayer argued that it owned and rented out several Sydney properties, but did not engage in other business activities or receive the significant amounts of income that the ATO had assessed to it.

Evidence before the Tribunal showed the taxpayer made a range of expensive capital purchases, including fitness equipment, more than 30 motor vehicles, firearms and a “bomb dog”. Its bank statements included references to “consultation fees”, “gun licenses” and a “security industry register”.  A loan application suggested income 20 times what the taxpayer admitted to earning and had apparently made significant loans to related parties with no returns.

The commentary suggested that ATO was better prepared with evidence than the taxpayer.

It is hardly surprising that the Tribunal upheld the assessments and penalties issued and allowed the ATO to impose an extra 20% penalty for two of the taxpayer’s income years.

We report this case mainly to remind taxpayers about that burden of proof is theirs and disputation success can depend on case preparation and credibility.

 

AcctWeb

© O'Brien and Partners 2011 - All Rights Reserved | 91 Station Street, Malvern VIC 3144 | Tel: 03 9509 3911 | Fax: 03 9509 3922