TAXATION- administrative penalties - whether applicant liable for administrative penalties on the basis of recklessness - where applicant allowed an old acquaintance to lodge amended income tax returns on applicant's myGov account where amendments included a deduction equivalent to the gross income of the applicant in each of three income years reducing the taxable income for each year to nil resulting in fraudulent tax refunds - whether penalties imposed were excessive or incorrect - whether penalties should be remitted - where applicant was initially suspicious but considered old acquaintance to be knowledgeable about tax - where applicant believed he is the victim and was scammed - where applicant argued he took reasonable care and was not reckless - where applicant stated he was remorseful - where disclosure made after examination of applicant's tax affairs commenced and after penalty assessments issued - objection decision affirmed

Taxation Administration Act 1953 (Cth) s 14ZZK, Schedule 1, ss 284-75, 284-85, 284-90,

Bosanac v Commissioner of Taxation [2018] FCA 945

Bosanac v Federal Commissioner of Taxation [2019] FCAFC 116 Bosanac v Federal Commissioner of Taxation [2019] HCA 41

BRK (Bris) Pty Ltd v Federal Commissioner of Taxation [2001] FCA 164 Commissioner of Taxation v Huang [2025] FCA 1314

Hart v Federal Commissioner of Taxation [2003] FCAFC 105

Sanctuary Lakes Pty Ltd v Commissioner of Taxation [2013] FCAFC 50; (2013) 212 FCR 483

1. In August 2021, Mr Jamie Crawford allowed an old acquaintance, who had spruiked a so-called loophole to get all his tax back on social media, to lodge amended income tax returns

on his behalf for the income years ended 30 June 2019, 2020, and 2021. It turns out that fraudulent deductions were claimed in each of those income tax returns equivalent to his gross income. Consequently, Mr Crawford's taxable income was reduced to nil, and he obtained tax refunds from the Australian Taxation Office (ATO).

1. Mr Crawford does not dispute that he never incurred the expenses referable to the claimed deductions and that he was not entitled to the income tax refunds. Mr Crawford stated he thought at the time of the lodgement of his amended returns that his old acquaintance, Mr John Eleuteri, was a tax agent or that he was knowledgeable about tax laws but now accepts that was not the case.

1. This dispute is about the notices of administrative penalty assessments issued to Mr Crawford by the Commissioner which were for the amounts of $18,415.80, $24,039.85 and

$20,823.71 for the for the 2019, 2020 and 2021 income years, respectively (the Penalty Assessments), as a result of the lodgement of the abovementioned amended income tax returns. The Commissioner considered Mr Crawford had been reckless and imposed a 50% administrative penalty on the tax shortfalls. The Commissioner also did not remit the Penalty Assessments.

1. The two issues for determination by the Tribunal are, firstly, whether the penalties for recklessness were properly imposed pursuant to ss 284-85 and 284-90(1) Item 2 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA); and, secondly, whether the penalties should be remitted in part or in full under s 298-20 of Schedule 1 to the TAA.

1. Mr Crawford as the taxpayer bears the burden of proving that the Penalty Assessments are excessive and or otherwise incorrect and what the assessments should have been: s 14ZZK(b)(i) of the TAA.1

1. As these reasons will explain, I have decided that Mr Crawford did not discharge the burden of proving the administrative penalties were excessive or otherwise incorrect. Accordingly, I have decided to affirm the reviewable objection decision.

1 Bosanac v CommissionerofTaxation [2018] FCA 945 at [131]- [132], [150] per Steward J; Bosanac v Federal Commissioner of Taxation [2019] FCAFC 116 at [128] per Greenwood, Burley and Colvin JJ; Bosanac v Federal Commissioner of Taxation [2019] HCA 41 at[14] per Nettle J; Commissioner of Taxation v Huang [2025] FCA 1314 at [63] per Feutrill J.

1. The following findings are based on the respective Statements of Facts, Issues and Contentions of Mr Crawford and the Commissioner, as well as the T-Documents filed by the Commissioner and, additionally, the evidence before the Tribunal. That evidence comprised of a witness statement of Mr Crawford dated 19 December 2024. Mr Crawford was also cross-examined at the hearing, which took place by telephone at his request.

1. The hearing had commenced on 30 September 2025; however, it was adjourned shortly after commencement because Mr Crawford did not have the bundle of T-Documents before him. It resumed by telephone on 21 October 2025. Mr Crawford represented himself at the hearing although he earlier had pro bona assistance provided to him for preparing his Statement of Facts, Issues and Contentions and his witness statement.

1. Mr Crawford is a tyre fitter who works on mining sites. Mr Crawford used a registered tax agent to prepare and lodge his returns for the 2019, 2020 and 2021 income years. The tax agent had prepared and lodged Mr Crawford's tax returns for some 16 years. His deductions, when his tax returns were prepared by his tax agent contained modest amounts for work related expenses and the cost of managing his tax affairs. For example, the original tax return for the 2019 income year had total work-related deductions of $354.

1. Mr Crawford's predicament with respect to the imposition of administrative penalties (and related general interest charges) is based on what happened because of events that occurred sometime afterwards as a result of another intermediary's involvement, as set out below.

1. On 4 August 2021, Mr Crawford was contacted by Mr Eleuteri through Facebook Messenger. Mr Crawford stated he was an old acquaintance who had not been in contact for over 20 years. Relevantly, the messages sent by Mr Eleuteri to Mr Crawford read, as follows: "Hey Jamie got a real good one for you if you're interested? Get all your tax back that you've paid for this year and last three years. Someone found a loophole and taught me how to do it".

1. Mr Crawford's reply on the same date was: "Sounds like a scam".

1. Mr Eleuteri continued, as follows: "Nope I've done it myself and got every single cent ..."
2. Mr Crawford stated in his witness statement that he remembered that Mr Eleuteri subsequently sent him examples of paperwork completed by him for at least 10 different people and they seemed legitimate. Mr Crawford stated that Mr Eleuteri then called him every day for about a week to persuade him to engage his services. Mr Crawford stated that, at Mr Eleuteri's invitation, he went to Mr Eleuteri's home which was a large house. Mr Eleuteri also had two sports cars, and a large office space set up with big computer screens, all of which gave Mr Crawford the impression that his services were legitimate.

1. On or about 10 August 2021, Mr Crawford followed Mr Eleuteri's instructions and provided him with his myGov login details and mobile phone which allowed Mr Eleuteri to lodge amended income tax returns on behalf of Mr Crawford for the 2019, 2020 and 2021 income years. Mr Crawford stated that the arrangement with Mr Eleuteri was that if Mr Crawford obtained any refunds, Mr Eleuteri would receive 10% of them.

1. On 16 August 2021, Mr Eleuteri sent a Facebook message to Mr Crawford saying he should "see if something lands in ... "I accept that this was most likely a reference to seeing whether the amended income tax returns lodged on or about 10 August 2021 yielded any tax refunds to Mr Crawford.

1. On 17 and 19 August 2021, the ATO paid tax refunds to Mr Crawford of$48,106.59 (for the 2020 income year) and $36,856.88 (for the 2019 income year), respectively.

1. On 16 September 2021, the ATO issued a notice of amended assessment indicating a refund of $41,647.42 for the 2021 year but withheld the payment to Mr Crawford.

1. In his witness statement, Mr Crawford stated that when the 2021 tax refund was blocked, the ATO started calling him and he panicked and did not know what to do. He called Mr Eleuteri who he says told him to ignore the ATO, that everything would be fine and to pay his fees.

1. On 28 September 2021, Mr Eleuteri sent a Facebook message to Mr Crawford asking for a myGov ATO screenshot. Mr Eleuteri added that "No one has been asked to return any money in over 2 years".
2. After a period of more than six months, on 21 April 2022, the Commissioner commenced an audit in relation to Mr Crawford's 2019, 2020 and 2021 income tax years with respect to his expense claims.

1. On 10 June 2022, the Commissioner issued a finalisation audit letter and, on 14 June 2022, the Commissioner issued the Penalty Assessments to Mr Crawford.

1. By 15 June 2022, Mr Crawford had informed Mr Eleuteri of the amended assessments and the Penalty Assessments because Mr Eleuteri was saying in Facebook messages to him that, hopefully, Mr Crawford's accountant was "not stupid enough" to give any of the refunds back. Mr Eleuteri also suggested Mr Crawford provide his accountants with a link to information suggesting that the ATO is not a legal entity and has no authority to collect taxes as evident from a Facebook message. Mr Crawford explained that, subsequently, Mr Eleuteri offered to arrange for a person who he described as an "attorney in fact" to help Mr Crawford if Mr Crawford did not use or allow his accountants to interfere. Mr Crawford stated that it was around this time that he finally understood that Mr Eleuteri was wrong and that he should have spoken to the ATO officers.

1. Mr Crawford then went to see his tax agent and he paid back the ATO the tax refunds he had received. On or around 28 June 2022, his tax agent sent a "voluntary disclosure" form to the Commissioner on behalf of Mr Crawford. During a telephone conversation on 28 June

2022, Mr Crawford's tax agent stated that Mr Crawford "was a victim of a scammer and [was] prepared to provide [the ATOJ with all information".

1. On 6 August 2022, with the assistance of his tax agent, Mr Crawford lodged an objection to the Penalty Assessments.

1. On 13 January 2023, the Commissioner decided to disallow Mr Crawford's objection.

WERE THE ADMINISTRATIVE PENALTIES EXCESSIVE OR INCORRECT?

1. A person is liable to an administrative penalty if they make a statement to the Commissioner which is false or misleading in a material particular: s 284-75(1) of Schedule 1 to the TM. The amount of the penalty is a percentage of the base penalty amount worked out in accordance with the formula ins 284-85 of Schedule 1 to the TAA. The base penalty amount is worked out in accordance with the table in s 284-90(1) which, relevantly, prescribes

percentages of 25%, 50% or 75% of the shortfall amount depending on the taxpayer's culpability. Under s 298-30 of Schedule 1 to the TAA, the Commissioner must make an assessment of the penalty.

1. Where a person has a shortfall amount that resulted from recklessness by the taxpayer or their agent as to a statement made to the Commissioner about the operation of a taxation law, then the base penalty amount is 50% of the shortfall amount. "Recklessness" refers to something more than a failure to exercise reasonable care but less than an intentional disregard as to the operation of a taxation law. It involves behaviour that shows disregard of or indifference to a risk that is foreseeable by a reasonable person. The conduct is more than mere negligence and must amount to gross carelessness.2 "Recklessness consists in making a _claim, not caring whether the claim is true or false"._3 The actual intention of the taxpayer is irrelevant.

1. It was common ground before me that the deductions claimed by Mr Crawford in each of his amended tax returns for the 2019, 2020 and 2021 income years were false. Mr Crawfcrd has never suggested that he had incurred the expenses.

1. Mr Crawford argued that he was not reckless, only that he failed to take reasonable care in allowing Mr Eleuteri to lodge the amended income tax returns for him and, therefore, that the penalties should have been imposed at the lower rate of 25%. Mr Crawford stated that he thought Mr Eleuteri was a tax agent or knowledgeable about tax laws at the relevant time and that he was the victim of a scam.

1. However, the objective facts support a conclusion that Mr Crawford's conduct constitutes recklessness, namely, gross carelessness as to whether his amended tax returns were correct. These facts are as follows. First, Mr Crawford had not actually incurred any expenses to which the claimed deductions related. The deductions were entirely fabricated. Mr Crawford must have known this. Besides, he had already lodged his income tax returns for the three previous years with his tax agent. Secondly, Mr Crawford had relied on Mr Eleuteri's claim that "there was no chance of getting caught". Any reasonable person would

2 Hart v Federal Commissioner of Taxation [2003] FCAFC 105 at [33] per Spender J and [43] per Hill and Hely JJ; BRK (Bris) Pty Ltd v Federal Commissioner of Taxation [2001] FCA 164 at [77) per Cooper J.

3 Hart v Federal Commissioner of Taxation [2003) FCAFC 105 at [34] per Spender J.

have understood that that statement suggested wrongdoing. Any reasonable person would have questioned whether a registered tax agent would have made such a statement. Also, the so-called loophole to which Mr Eleuteri had earlier referred in his Facebook message to Mr Crawford (see [11] above) would have alerted any reasonable person that it had no lawful basis, and the tax refunds were dependent on not being detected. Thirdly, Mr Crawford admitted giving Mr Eleuteri access to his myGov accounts to prepare and lodge the amended returns. In so doing, Mr Crawford contravened the terms of use for his myGov account, facilitated the lodgements of the amended returns by Mr Eleuteri and thereby also gave Mr Eleuteri ostensible authorisation to give effect to what he did.

1. The fact hat Mr Eleuteri's expertise was apparently based upon what someone had taught him, as he stated in a Facebook message to Mr Crawford (see [11] above), should have also alerted Mr Crawford to the fact he was not a tax agent nor knowledgeable about tax law. The statement is inconsistent with a later representation made in Mr Crawford's objection that Mr Eleuteri had "held himself out to be a tax agent". Even if Mr Eleuteri did, at some stage, suggest he was a tax agent, Mr Crawford should have questioned him. Any reasonable person would have done so. Furthermore, the arrangement that Mr Crawford entered with Mr Eleuteri for a 10% fee of refunds from the ATO should have caused him to doubt Mr Eleuteri's credentials. Mr Crawford's claim that this fee structure had served to reinforce his belief that the amendments must have been legitimate is rejected as implausible.

1. The practical reality is that although Mr Crawford had concerns about the proposal put to him by Mr Eleuteri and considered it to be suspicious at the outset as evident from his Facebook message to Mr Eleuteri see [12] above), Mr Crawford did not check whether Mr Eleuteri was properly registered as a tax agent nor ask his own tax agent. He went along with what Mr Eleuteri put to him in an opportunistic manner to benefit from the false statements. In the circumstances, I was not persuaded by Mr Crawford's evidence that he "was not aware that there was any risk that what [Mr Eleuteri] was doing was incorrect." Mr Crawford must have been on notice, as would any reasonable person, that there was a real risk that his amended tax returns were incorrect, but he was grossly indifferent to that risk.

1. It follows that Mr Crawford has failed to discharge his burden on the balance of probabilities that the penalties imposed at the rate of 50% on the basis of recklessness were excessive or otherwise incorrect.

SHOULD THE ADMINISTRATIVE PENALTIES BE REMITTED?

1. Section 298-20(1) of Schedule 1 to the TAA provides that the Commissioner may remit all or a part of the penalty. The considerations which might be relevant to the exercise of the discretion to remit in s 298-20 of Schedule 1 to the TAA are those which concern circumstances that could be regarded as mitigating the taxpayer's behaviour in some way or, in other words, those which go to reducing the taxpayer's culpability for the circumstances which brought about the imposition of the penalty. This is because although the discretion conferred by s 298-20(1) is unconstrained, according to its terms, it must nevertheless be exercised for a proper purpose in accordance with the objects of the TAA.4

1. The question is whether there were circumstances surrounding the failure by the taxpayer in making the statements to the Commissioner that might explain the conduct the subject of the penalty and which rendered the imposition of penalty at that rate inappropriate. While the harshness of the penalty is not the relevant test, the discretion may well call on the decision-maker, here the Tribunal standing in the shoes of the Commissioner, to determine whether the outcome for a particular taxpayer would be unreasonable or unjust and, therefore, inappropriate.5 In order to succeed on the remission aspect, Mr Crawford must show there were circumstances that could be regarded as mitigating Mr Crawford's behaviour in some way.

1. Mr Crawford maintained that he was a victim, and he submitted that the Commissioner should pursue Mr Eleuteri as the person who promoted the fraudulent arrangement and who had undertaken the requisite steps. Mr Crawford also argued that he had been willing to disclose the details of Mr Eleuteri to the ATO and that he was extremely remorseful and would not do it again. As stated above, Mr Crawford claimed that he was not aware that there was any risk that what he was doing was incorrect and he had no reason to question Mr Eleuteri's authority to lodge his amended tax returns; however, I did not accept that evidence as persuasive. Mr Crawford also gave evidence as to his own personal and financial obligations including being financially responsible for several family members and having to sell machinery to pay the Penalty Assessments and related interest charges.

4 Sanctuary Lakes Pty Ltd v Federal Commissioner of Taxation (2013] FCAFC 50 at (193] per Greenwood J.

5 Sanctuary Lakes Pty Ltd v Federal Commissioner of Taxation (2013] FCAFC 50 at [249] per Griffiths J.

1. I agree with the Commissioner's submission that these are insufficient factors to make remission appropriate in these circumstances. Mr Crawford lacked self-awareness in that he continued to characterise himself as the victim. Similarly, Mr Crawford also failed to take responsibility for enabling Mr Eleuteri to lodge his amended tax returns. Moreover, Mr Crawford only disclosed his predicament to his tax agent after the Commissioner had commenced the investigation of Mr Crawford's tax returns and issued the Penalty Assessments to him. The Commissioner aptly did not consider that the disclosure was made voluntarily by Mr Crawford so as to warrant some reduction or remission of penalties because, at the time it was made, it only confirmed what the ATO already knew. Granted, Mr Crawford did not spend any of the two tax refunds and he paid the money back to the ATO, but this was also only after being issued the Penalty Assessments and obtaining advice from his tax agent.

1. Finally, Mr Crawford's personal financial circumstances principally concerned his financial obligations to family members. It is not appropriate in the circumstances to place any weight on Mr Crawford's financial hardship or his remorse as relevant facta-s with respect to the remission of penalties which resulted from the consequences of his reckless conduct. Rather, the weight is properly placed in a case such as this involving opportunistic conduct, on the object of the penalty regime in the TAA, including to ensure compliance with taxation laws.

1. As Mr Crawford has not discharged the burden of proving that the penalties were excessive a-otherwise incorrect, the reviewable objection decision is affirmed.

I certify that the preceding 40 (forty) paragraphs are a true copy of the reasons for the decision herein of Deputy President G Lazanas

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29 September and 21 October 2025 Self-represented

Ms D Wong, Australian Taxation Office Litigation and Legal Services