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Federal Court fines tax professional $70k

The Federal Court has ordered a Sydney-based tax agent to pay a $70,000 penalty for breaching the Tax Agent Services Act 2009 (TASA).

News Michael Masterman 15 July 2014
— 1 minute read

Tsu Chien Su admitted to 50 contraventions of the TASA with 25 of the 50 relating to false information in returns derived from false payment summaries, and the other 25 contraventions relating to the falsity of the tax agent certificate contained in each return.

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This case is the first time the Federal Court has imposed a pecuniary penalty on a registered agent for contraventions of the TASA.

Court documents state that between 6 July 2011 and 9 August 2011, three persons approached Mr Su and asked him to prepare a large number of income tax returns on the basis of information they provided to him.

The information provided by these intermediaries included a false typewritten payment summary and, in many cases, handwritten information purporting to relate to the taxpayers.

Following a finding by the Tax Practitioners Board (TPB) that Mr Su had knowingly breached the Code of Professional Conduct, the TPB terminated his registration as a tax agent in August 2013, imposing a period of three years before he could reapply for registration. Mr Su has appealed this decision to the Administrative Appeals Tribunal.

Ian Taylor, chair of the TPB, said “The Tax Practitioners Board takes seriously any conduct that calls into question an agent’s integrity and competence.”

Mr Taylor told AccountantsDaily the TPB believes the judge’s findings and the penalty imposed are appropriate in light of the circumstances of the case.

“I think it recognises the seriousness of the agents conduct but it also makes allowance for his contrition and his cooperation during the proceedings.”

“Registered tax agents are in a position of trust and they have privileged access to information held by the ATO and they need to ensure that they access this information to check it for accuracy in the context of preparing client returns.”

Court documents state Mr Su “recklessly” made false statements to the tax commissioner and had not “deliberately or knowingly” provided false information.

“This case highlights that agents don’t need to have an intention to mislead the commissioner,” said Mr Taylor.

Whilst Mr Taylor said he would not describe this type of activity as a “huge problem” he said it is something the tax office is looking into.

“It’s certainly an issue the ATO is very conscious of and the direction we are moving in, with people now able to lodge via electronic forms to the ATO, is opening up the opportunity for this sort of activity,” Mr Taylor said. 

Federal Court fines tax professional $70k
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