Deputy Commissioner of Taxation v Gillespie

Catchwords: TAXATION – director penalty liabilities – PAYG withholding amounts – superannuation guarantee charge – assessed net amount under the A New Tax Systems (Goods and Services Tax) Act 1999 (Cth) –where the Taxation Administration Act 1953 (Cth) provides that allegations in certain documents are prima facie evidence of certain matters – where the defendant did not appear at the hearing – where the defendant did not lead evidence to rebut the prima facie evidence

Legislation Cited: A New Tax Systems (Goods and Services Tax) Act 1999 (Cth), s 33-3
Civil Procedure Act 2005 (NSW), s 100
Income Tax Assessment Act 1997 (Cth), s 995-1(1)
Superannuation Guarantee (Administration) Act 1992 (Cth) ss 33, 46
Taxation Administration Act 1953 (Cth), ss 3AA(2), Sch 1, ss 155-15, 255-1, 255-5(1), 269-10(1), 269-15(1)-(2), 269-20(1)-(2), 269-30(1), 350-10(3), 350(20)-1, , s 350-20, 350-25(a), 350-12, 350-15, Div 12 sub-div 16B
Uniform Civil Procedure Rules 2005 (NSW), r 29.7

Cases Cited: Deputy Commissioner of Taxation v Epov [2008] NSWSC 1085
Deputy Commissioner of Taxation v Houston [2026] NSWSC 392
Deputy Commissioner of Taxation v Lewer [2001] VSC 114
Deputy Commissioner of Taxation v Raskovic (2009) 75 ATR 359; [2009] NSWSC 281
Deputy Commissioner of Taxations v Lawson (2017) ATC 20-644; [2017] VSC 789

Category: Principal judgment

Parties: Deputy Commissioner of Taxation (Plaintiff)
Peter John Gillespie (Defendant)

Representation: Solicitors:
Craddock Murray Neumann Lawyers (Plaintiff)
No appearance for Defendant.

File Number(s): 2025/84700

Publication restriction: Nil.

JUDGMENT

INTRODUCTION

1. The Plaintiff (DCT) brought these proceedings to recover, as a debt, amounts alleged to be owed by the Defendant arising from the failure by RAILIUS AU PTY LTD CAN 622 523 988 (RAILIUS) to pay certain tax liabilities. The Plaintiff sought judgment in the amount of $629,484.55 together with interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW), and costs.

2. DCT proceeded by way of a Statement of Claim which pleaded the facts upon which the liability of the Defendant was alleged to arise.

3. The Defendant was, at all material times, a director of RAILIUS. DCT alleged that the Defendant was indebted to the Commonwealth of Australia (Commonwealth) as a director of RAILIUS for director penalties due under Division 269 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (the Act).

4. The Defendant filed a defence denying liability for the amounts claimed by DCT. He positively pleaded that:

(a) the Plaintiff overstated the quantum of the taxation liabilities and s 350-20 of Schedule 1 of the Act was not enlivened; (b) the Court should exercise its discretion to disallow its use in respect of the matters pleaded in the Claim.

THE HEARING

5. The proceedings were heard on 18 June 2026. The Defendant did not appear at the Hearing. DCT was represented by its solicitor. He provided the Court with an email from the Defendant which stated that the Defendant would not be appearing. The Court officer called for the Defendant outside the Court but there was no appearance.

6. Rule 29.7 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) sets out the procedure that applies when a party does not appear at a hearing of proceedings. DCT submitted that the Court should proceed to trial, rather than take the truncated course for judgment set out in r 29.7(3) of the UCPR. I acceded to DCT’s submission and proceeded to trial of the matter.

7. After trial, I concluded that the DCT had proved that the Defendant was liable in the amount claimed, and made the following orders:

8. Judgment for the Plaintiff against the Defendant in the amount of $694,536.41, inclusive of filing fee and service fees in the sum of $1,129.00.

9. Defendant pay the Plaintiff’s costs as agreed or assessed.

10. These are my reasons for making those orders.

EVIDENCE

9. DCT read and relied on two affidavits of Shriya Zad, who works in the Frontline Compliance section of the Australian Taxation Office:

(a) affirmed 1 December 2025 (Zad Affidavit); (b) affirmed 17 June 2026 (Second Zad Affidavit).

and tendered the exhibit to the Zad Affidavit. It is not necessary, in this Judgment, to set out the detail of the documentary tender.

10. Amongst the evidence in both Zad affidavits, are certificates signed by a Deputy Commissioner of Taxation stating, amongst other things, the amounts of director penalties in relation to which the Defendant is liable. Those amounts are set out in paragraph [26(c)] of this Judgment (Certificates). I address the force of these Certificates below.

11. The Defendant did not serve any evidence in support of his Defence.

STATUTORY SCHEME

12. Under s 255-5(1) of the Act, a tax-related liability that is due and payable is a debt due to the Commonwealth and is payable to the Commissioner and, by force of s 255-5 of the Act may be recovered by the DCT in this Court.

13. The Act provides DCT with several procedural advantages in proceedings to recover tax-related liabilities. In particular, the Act provides that allegations in certain documents are prima facie evidence of the facts alleged in those documents. [1]

14. Relevantly, to these proceedings, the Act provides that in a proceeding to recover an amount of a tax-related liability, such as these proceedings:

(a) a statement or averment about a matter in the plaintiff’s complaint, claim or declaration is prima facie evidence of the matter (s 350-20(1) of the Act); (b) the production of an evidentiary certificate signed by, amongst others, a Deputy Commissioner that states that, from the time specified in the certificate, an amount is payable under a taxation law to the Commissioner, is prima facie evidence that the amount is payable from that time and that the particulars stated in the certificate are correct (350-10(3) and 350-12 of the Act); (c) Section 350-15 of Sch 1 to the Act provides that judicial notice must be taken of the signatures of, amongst others, a Deputy Commissioner; (d) DCT may proceed by way of affidavit (s 350-25(a)).

15. It is clear, however, that these provisions do not make averments, or evidentiary certificates and the like conclusive evidence of the matters stated, and those matters may be rebutted by evidence, or indeed can be undermined potentially by cross examination. The evidence, as a whole, must be considered by the Court.

16. However, in the absence of evidence rebutting the prima facie evidence, or putting it in doubt, that evidence may be determinative in assessing whether DCT has discharged the legal burden of proving the case. [2]

17. The procedural advantages identified apply in relation to proceedings for the recovery of a ‘tax-related liability’. That phrase is defined in s 255-1 of Sch 1 to the Act. It means a pecuniary liability to the Commonwealth arising directly under a taxation law (including a liability the amount of which is not yet due and payable). Section 995-1(1) of the Income Tax Assessment Act 1997 (Cth) (ITAA 1997) applies to Sch 1 to the Act by operation of s 3AA(2) of the Act and broadly defines ‘Taxation law’.

The tax-related liabilities and Director liabilities

18. In certain circumstances, the Act imposes tax-related liabilities on a director of a company who has not complied with its tax obligations.

19. The imposition of those tax-related liabilities is commonly known as the Act’s Director Penalty regime. The relevant provisions imposing those liabilities are in Division 269 of Sch 1 of the Act.

20. In these proceedings, DCT alleges that RAILIUS failed to comply with its tax-related obligations in relation to:

(a) amounts withheld under Division 12 to the Commissioner in accordance with Subdivision 16-B (PAYGW Obligation); (b) the superannuation guarantee charge (SGC) (SGC Obligation); (c) an assessed net amount under the A New Tax Systems (Goods and S**ervices Tax) Act 1999 (Cth) (GST Act) (Net Amount Obligation).

21. In summary:

(a) the PAYGW Obligation is the obligation on an employer to withhold amounts from certain payments to, amongst others, employees which amounts must be remitted to the Commissioner by the relevant due dates; (b) the SGC Obligation is the obligation on an employer who has a superannuation guarantee shortfall in any quarter to lodge a superannuation guarantee statement by the date specified in s 33 of the Superannuation Guarantee (Administration) Act 1992 (Cth) (SGAA). In the circumstances set out in s 33, that statement has effect as an assessment of the employer’s liability to pay the SGC which is due and payable on the day specified in s 46 of the SGAA; (c) the Net Amount Obligation concerns the obligation on an entity registered under the GST Act to give the Commissioner a GST return for each tax period. In the circumstances set out in s 155-15 of the Act, that return is treated as being a notice of assessment by the Commissioner and the entity must pay that assessed amount by the date specified in s 33-3 of the GST Act.

22. Section 269-15(1) of the Act imposes an obligation on the directors of a company on or after the initial day to cause the company to comply with the obligations set out in paragraph [21] above. The initial day referred to in s 269-15(1) is defined in s 269-10(1).

23. Section 269-15(2) of the Act provides that the obligation on directors referred to above continues until the company complies with its obligations or an event described in s 269-15(2) occurs (which concerns a form of external administration).

24. Section 269-20(1) of the Act imposes an obligation on such a director to pay a penalty if the obligations of the director under s 269-15 are not complied with by the due day, and by s 269-20(2) that penalty is due and payable at the end of the due day.

25. Proceedings against a director to recover a penalty, however, must not be commenced unless the Commissioner has given the director 21 days' notice setting out what the Commissioner thinks is the unpaid amount of the company’s liability under its obligation. Such a notice is commonly known as a director penalty notice (DPN). A director’s penalty is, however, remitted under s 269-30(1) of the Act if, before or within 21 days after the Commissioner gives the DPN, the director stops being a director because of events stated in that section. Relevantly, here, one event concerns the winding up of the relevant company.

DCT PROVED ITS CASE

26. I accepted that the following extract from DCT’s submissions accurately reflected the facts and matters established by DCT’s evidence:

(a) RAILIUS was incorporated on 27 October 2017; (b) the Defendant became a director of RAILIUS on the date of incorporation and has not since ceased as a director of RAILIUS; (c) the Defendant’s liability for director penalties arises in respect of RAILIUS’s failure to pay to the Commissioner by the relevant due dates:

(i) actual amounts withheld under the PAYG Withholding provisions in the sum of $428,029.67; (ii) SGC in the sum of $103,844.53; (iii) assessed net amounts in the sum of $97,610.35;

(d) for each of the periods from 1 July 2022 to 31 August 2024, RAILIUS notified the Commissioner of amounts of PAYG Withholding by lodging BAS Forms (Withholding Amounts); (e) the Defendant, as a director of RAILIUS, was under an obligation to cause the RAILIUS to pay the Withholding Amounts. RAILIUS did not pay by the due days the total amount of the Withholding Amounts, and accordingly the Defendant became liable to pay to the Commissioner a penalty equal to the unpaid amount of the Withholding Amounts; (f) no payments have been made and/or credits allowed since the commencement of the proceedings to reduce the Defendant’s liability to pay to the Commissioner a penalty in the amount of $428,029.67 in respect of the unpaid amount of the Withholding Amounts; (g) for each of the tax periods ending 30 June 2023 to 31 March 2024, the Commissioner assessed RAILIUS’s superannuation guarantee shortfall and of the SGC payable on the shortfall, or RAILIUS lodged with the Commissioner a superannuation guarantee statement (SGC Assessed Amounts); (h) the Defendant, as a director of RAILIUS, was under an obligation to cause RAILIUS to pay the SGC Assessed Amounts. RAILIUS did not pay by the due days the total amount of the SGC Assessed Amounts, and accordingly the Defendant became liable to pay to the Commissioner a penalty equal to the unpaid amount of the SGC Assessed Amounts; (i) no payments have been made and/or credits allowed since the commencement of the proceedings to reduce the Defendant’s liability to pay to the Commissioner a penalty to the amount of $103,844.53 in respect of the unpaid amount of the SGC Assessed Amounts; (j) for each of the tax periods in the periods ending 30 September 2022 to 30 September 2023, the Commissioner made, or is taken to have made, assessments of RAILIUS’s assessed net amounts (Net Amounts); (k) the Defendant, as a director of RAILIUS, was under an obligation to cause RAILIUS to pay the Net Amounts. RAILIUS did not pay by the due days the total amount of the Net Amounts, and accordingly the Defendant became liable to pay to the Commissioner a penalty equal to the unpaid amount of the Net Amounts; (l) no payments have been payments made and/or credits allowed since the commencement of the proceedings to reduce the Defendant’s liability to pay to the Commissioner a penalty in the amount to $97,610.35 in respect of the unpaid amount of the Net Amounts.

27. The evidence is that written notice of the director penalties was given to the Defendant on 31 May 2024 and 30 October 2024.

28. None of the events set out in s 269-30 occurred and accordingly, there was no remittance of the penalties. In particular, RAILUS did not begin to be wound up within 21 days after written notice of the penalties was given to the Defendant, with the liquidator not being appointed until 23 April 2025.

29. As noted above, the Defendant did not serve any evidence in support of the matters raised in his Defence. In those circumstances, there is no evidence to rebut or put into doubt the prima facie evidence relied upon by DCT. The Defendant’s pleas in his defence, unsupported by evidence, cannot overcome or put in doubt the prima facie evidence contained in both the Certificates and the averments in its Statement of Claim.

30. Moreover, contrary to what is implicitly alleged in the Defence, the Court does not have a discretion with respect to the application of s 350-20 of the Act concerning the prima facie evidentiary force of statements or averments in DCT’s Statement of Claim. The section applies on its terms. In any event, no evidence was led to support an exercise of discretion in the manner sought by the Defendant if, contrary to my view, such a discretion, existed.

31. Accordingly, I found, based on the evidence in both Zad Affidavits including the Certificates, the facts and matters set out in paragraphs [26] to [28] above.

CONCLUSION

32. DCT established an entitlement to judgment against the Defendant in the amount of $629,484.55 together with interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW) to the date of judgment, and costs. At the Hearing, DCT indicated that it was seeking interest only from the date of the filing of the Statement of Claim.

33. Accordingly, for the above reasons, I made the following Orders:

34. Judgment for the Plaintiff against the Defendant in the amount of $694,536.41, inclusive of filing fee and service fees in the sum of $1,129.00.

35. Defendant pay the Plaintiff’s costs as agreed or assessed.

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Endnotes

See Deputy Commissioner of Taxation v Lewer [2001] VSC 114 at [6] where Bongiorno J was dealing with the application of s 255-55 (the statutory precursor to s 350-12) which was, in material respects in the same terms as s 350-12 of the Act. See also Deputy Commissioner of Taxation v Raskovic (2009) 75 ATR 359 at 364; [2009] NSWSC 281 at [22]; Deputy Commissioner of Taxations v Lawson (2017) ATC 20-644; [2017] VSC 789; Deputy Commissioner of Taxation v Houston [2026] NSWSC 392.

A defendant must do more than merely plead matters attacking the DCT’s prima facie evidence: DCT v Epov [2008] NSWSC 1085 at [32]. See also Deputy Commissioner of Taxation v Houston [2026] NSWSC 392 at [23].