ACT Civil and Administrative Tribunal|2016-03-16|Before: Commissioner For

For the reasons set out above the Tribunal finds that:
- (a) The applicants did not comply with section 14 of the LT Act. This is a tax default to which section 31 of the TA Act applies.
- (b) The applicants failed to take reasonable action to comply with section 14 of the LT Act and have not provided a reasonable excuse for that failure to comply. The Tribunal finds that neither section 31(3) nor section 31(6) of the TA Act apply to reduce the rate of penalty tax that should be applied. The Tribunal finds that the appropriate rate of penalty tax to be applied is 50% pursuant to section 31(2) of the TA Act.
- (c) the Tribunal is not persuaded that the applicants took reasonable steps to mitigate the circumstances that lead to the penalty tax liability. Nor is the Tribunal satisfied that exceptional circumstances resulted in the penalty tax liability. The Tribunal finds that the evidence relied on by the applicants does not satisfy section 37(a)(i) or (ii) of the TA Act. The Tribunal finds that it would not be fair and reasonable to remit part or all of the penalty tax liability. The Tribunal is not persuaded to exercise the discretion afforded by section 37 of the TA Act to remit part or all of the penalty tax liability.

Pursuant to section 68(3) of the the respondent's reviewable decision to impose penalty tax at a rate of 50% for the land tax liability determined from 21 September 2010 to 21 October 2013 for the Forrest property is confirmed.

(1) This section applies if the tribunal reviews a decision by an entity.

(2) The tribunal may exercise any function given by an Act to the entity for making the decision.

Note A reference to an Act includes a reference to the statutory instruments made or in force under the Act, including regulations (see Legislation Act, s 104).

(ii) remit the matter that is the subject of the decision for reconsideration by the decision-maker in accordance with any direction or recommendation of the tribunal.

Commissioner to be told if residential land rented

(1) This section applies in relation to a parcel of land that -

(2) A relevant person must tell the commissioner, in writing -

Note 1 If a form is approved under the Taxation Administration Act 1999, s 139C, the form must be used.

Note 2 It is an offence to fail to notify the commissioner under this section (see Taxation Administration Act 1999, s 67 (2)).

Note 3 It is also an offence to knowingly avoid paying, or disclosing a liability to pay, part or all of an amount of tax (see Taxation Administration Act 1999, s 65 (1)).

(3) The relevant person must tell the commissioner the information mentioned in subsection (2) not later than 30 days after -

(a) if there is a change of ownership of the parcel - the day the ownership changes; or

(4) This section does not apply if the owner of the parcel of land is a corporation.

(b) if the owner has authorised an agent to act on the owner's behalf in relation to the rental of the parcel - the agent.

Note An example is part of the Act, is not exhaustive and may extend, but does not limit, the meaning of the provision in which it appears (see Legislation Act, s 126 and s 132).

19A Interest and penalty tax payable on land tax if no disclosure

(a) land tax is imposed on a parcel of rateable land; and

(b) the owner of the parcel of land fails to comply with section 14 (Commissioner to be told if residential land rented) or section 14A (Commissioner to be told if residential land owned by an individual as trustee).

(2) The owner is liable to pay interest on the amount of land tax from the end of 30 days after the 1st day of the 1st quarter for which the tax is imposed.

(3) Interest on the amount of land tax is worked out -

(d) on the total amount of land tax that is payable on a day when the interest is worked out.

Note The Minister may determine an interest rate for this section under the Taxation Administration Act, s 139.

(4) For subsection (3) (a), if an amount of land tax is payable for part of a month, interest is payable for the whole month.

(5) The Taxation Administration Act, division 5.2 (Penalty tax) applies to the owner of the parcel of land as if -

(a) the owner's failure to comply with section 14 or section 14A were a tax default; and

(b) a reference to interest under division 5.1 were a reference to interest under this section; and

(6) This section applies to land tax imposed before or after the commencement of this section.

(1) The commissioner may remit all or part of an amount of interest payable by a person in relation to land tax if the commissioner is satisfied that it is fair and reasonable having regard to -

(a) any circumstances that contributed to the delay in payment of the land tax; or

(2) The Minister may make guidelines for the exercise of a function under this section.

Note A disallowable instrument must be notified, and presented to the Legislative Assembly, under the Legislation Act.

The following decisions of the commissioner are prescribed for the Taxation Administration Act, section 100 (Objection):

(a) a decision under section 13 (1) (b) to refuse to exempt a parcel of land from land tax on compassionate grounds;

(b) a decision under section 13 (5) revoking an exemption given on compassionate grounds;

(d) a decision under section 37 to refuse to pay interest on an overpayment or to pay interest other than from the date when the overpayment was made.

Note Assessments are made under the Taxation Administration Act and objections may be made under that Act, s 100 (1) (a). For example, if a person is given an assessment for land tax and the person is dissatisfied with the assessment because land tax was not payable in relation to the parcel of land, the person may object under that paragraph.

(1) This section applies to a determination by the commissioner of an objection to a decision mentioned in section 38 , other than a decision mentioned in section 38 (c).

(2) The determination is prescribed for the Taxation Administration Act, section 107A (Meaning of reviewable decision etc - div 10.2).

Note Applications for review by the ACAT may be made in relation to a determination by the commissioner of a decision on an objection to an assessment.

(a) the registered proprietor of an interest in the parcel (other than an interest in a lease granted by a person other than the Territory or the Commonwealth); or

(b) if the registered proprietor has sold the interest to another person (the new owner) and the new owner is in possession of the parcel but not yet registered as the proprietor - the new owner; or

(d) a person holding the parcel under a sublease from the Territory, if the Territory holds the parcel under a lease from the Commonwealth; or

(e) for a parcel held under a land sublease - the sublessee.

(1) The amount of penalty tax payable in relation to a tax default is 25% of the amount of tax unpaid, subject to this division.

(2) The amount of penalty tax payable in relation to a tax default is 50% of the amount of tax unpaid if the commissioner is satisfied that the tax default was caused wholly or partly by a failure by the taxpayer (or a person acting on behalf of the taxpayer) to take reasonable care to fulfil the taxpayer's obligations under a tax law.

(3) Subsection (2) does not apply if the tax payer satisfies the commissioner that the taxpayer (or a person acting on behalf of the taxpayer) had a reasonable excuse for the failure.

(4) Subsections (2) and (3) apply to a tax default that happened before their commencement in the same way as they apply to a tax default that happened after their commencement.

(5) The amount of penalty tax payable in relation to a tax default is 75% of the amount of tax unpaid if the commissioner is satisfied that the tax default was caused wholly or partly by the intentional disregard by the taxpayer (or a person acting on behalf of the taxpayer) of a tax law.

(6) No penalty tax is payable in relation to a tax default if the commissioner is satisfied that -

(a) the taxpayer (or a person acting on behalf of the taxpayer) took reasonable care to comply with the tax law; or

(b) the tax default happened solely because of circumstances beyond the taxpayer's control (or if a person acted on behalf of the taxpayer, because of circumstances beyond either the person's or the taxpayer's control) but not amounting to financial incapacity.

Note The commissioner's decision to impose penalty tax is an internally reviewable decision (see s 107, def internally reviewable decision), and the commissioner must give an internal review notice to the taxpayer (see s 107B).

Reduction in penalty tax for voluntary disclosure

The amount of penalty tax determined under section 31 is reduced by 80% if, before the commissioner informs the taxpayer that an investigation relating to the taxpayer is to be carried out, the taxpayer discloses to the commissioner, in writing, sufficient information to enable the nature and extent of the tax default to be determined.

Reduction in penalty tax for disclosure before investigation

The amount of penalty tax determined under section 31 is reduced by 20% if, after the commissioner informs the taxpayer that an investigation relating to the taxpayer is to be carried out and before it is begun, the taxpayer discloses to the commissioner, in writing, sufficient information to enable the nature and extent of the tax default to be determined.

The commissioner may remit all or part of an amount of penalty tax payable by a person if satisfied that -

(i) the person has taken reasonable steps to mitigate, or to mitigate the effects of, the circumstances that resulted in the liability for penalty tax; or

(ii) the circumstances that resulted in the liability for penalty tax were exceptional; and

(b) it would be fair and reasonable to remit all or part of the penalty tax.

Note The commissioner's decision to refuse to remit penalty tax payable by a person is an internally reviewable decision (see s 107, def internally reviewable decision), and the commissioner must give an internal review notice to the person (see s 107B).

(1) A taxpayer may lodge a written objection with the commissioner if the taxpayer is dissatisfied with -

(a) an assessment, other than a compromise assessment, that is shown in a notice of assessment served on the taxpayer; or

(b) a decision mentioned in schedule 1 or schedule 2; or

Note Decisions are prescribed for this section under the following Acts:

(2) An objection must be accompanied by the fee (if any) determined under section 139A (Determination of fees) for the objection.

(3) The commissioner must refund a fee paid under this section if -

(a) the commissioner allows the objection in whole or in part; or

(i) the ACAT, or a court hearing an appeal on the matter, upholds the objection in whole or in part; or

(ii) the period when any further appeal can be made has ended; and

(iii) neither the taxpayer nor the commissioner has applied to the ACAT in relation to a part of the objection that was upheld.

(1) The grounds for the objection must be stated fully and in detail, and must be in writing.

(2) The grounds for the objection, for a reassessment, are limited to the extent of the reassessment.

(3) The burden of showing that an objection should be sustained lies with the taxpayer making the objection.

Recovery of tax pending objection or review

The fact that an objection or review is pending does not affect the assessment or decision to which the objection or review relates, and tax may be recovered as if no objection or review were pending.

107A Meaning of reviewable decision etc - div 10.2

(1) For this division, a reviewable decision is a determination by the commissioner of an objection by the taxpayer to -

(b) a decision mentioned in schedule 1, section 1.2; or

(2) For the ACT Civil and Administrative Tribunal Act 2008, section 9 (Applications under authorising laws), the tax laws are taken to be a single authorising law.

(1) The appellant's and respondent's cases on a review mentioned in section 108A are not limited to the grounds of the objection.

(2) However, if the objection was to a reassessment, the grounds of the review are limited to the extent of the reassessment.

Schedule 1 Decisions reviewable by commissioner and ACAT

(see s 100, s 107 and s 107A)

A person dissatisfied with a decision mentioned in section 1.2 may -

(a) lodge an objection under section 100; and

(b) if dissatisfied with the determination of the objection - apply to the ACAT under section 108A (Applications for review).

1.2 Decisions subject to objection or review

Section 1.1 applies to a decision -

(a) under section 8 determining the existence and effect of a tax avoidance scheme; or

(b) under section 18F refusing an application for a beneficial organisation determination; or

(d) under section 31 to impose penalty tax; or

(e) under section 34 to impose increased penalty tax; or

(f) under section 37 refusing to remit penalty tax; or

(g) under section 40 (5) revoking a variation previously granted in relation to requirements for a return; or

(h) under section 43 refusing an application for special arrangements for lodgment of returns or methods of payment; or

(i) under section 44 imposing conditions on an approval under section 43; or

(j) under section 45 varying or cancelling an approval under section 43; or

(k) under section 103 refusing permission to lodge a late objection.

[1] Exhibit R6 is a copy of the transfer document lodged on 6 April 2011 by NAB at pages 38 -39 of the T Docs.

[2] Exhibit A1 - Fourth Installment Notices for Rates 2010-11 in relation to the property with hand written notes in pen made by Peter Harding

[4] The number 116616450609 is recorded in pen within the 'Receipt Details' box on page 1 of Exhibit A1

[8] Exhibit R1 - Mr Siiteri's statement at paragraph 3

[10] being the telephone conversation referred to in paragraph 14 above

[13] ST Doc 2 at Row 1 which is highlighted and the full text of the memo appears in the box at the bottom of the page - dated 23 June 2011 at 11:51

[21] Sections 36, 38(c) and 39(1) of the LT Act

[22] Section 100(1)(b); schedule 1 - part 1.1 and 1.2(d) and (f); 107A and 108 of the TA Act

[29] see paragraph 14 above and Exhibit A1

[41] Definition of 'owner of a parcel of land' in the LT Act

[42] T Docs 61 with enclosures pages 62-65

Civil and Administrative Tribunal Act 2008

Administration Act 1999

"Taxation Administration Act 1999

HARDING v COMMISSIONER FOR ACT REVENUE (Administrative Review) [2016] ACAT 8 (16 March 2016)

HARDING v COMMISSIONER FOR ACT REVENUE

At a glance

Court

Decision date

Before

Source

Judgment (119 paragraphs)

Parties

Legislation Cited (5)

Cases Cited (1)

HARDING v COMMISSIONER FOR ACT REVENUE (Administrative Review) [2016] ACAT 8 (16 March 2016)