1. Base penalty amounts were originally assessed at the rate of 75% of the shortfalls, for intentional disregard of the law, in respect of the assessments of net amount for the December 2019 to March 2021 and September 2022 tax periods, and in respect of the FTC shortfalls for the December 2019 to June 2020, December 2020, March 2021, December 2021 and September 2022 tax periods.
2. The base penalty amounts were uplifted by 20% in respect of the second and subsequent assessments. At objection, the Commissioner reduced the base penalty rate to 50% for recklessness. The 20% uplift in respect of the second and subsequent assessments, which applies by operation of the statute, was maintained.

1. To be entitled to ITCs and FTCs, a person must be registered or required to be registered for GST: A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act), s 11-5(d); Fuel Tax Act 2006 (Cth), s 41-5(2).
2. Under s 23-10 of the GST Act, a person may be registered for GST if they are carrying on an enterprise or intend to carry on an enterprise from a particular date.
3. The Commissioner must cancel a GST registration if the Commissioner is satisfied the person is not carrying on an enterprise and believes on reasonable grounds that the person is not likely to be carrying on an enterprise for at least 12 months: GST Act, 25-55(2).
4. The entitlement to ABN registration is dependent upon the person carrying on an enterprise as defined for GST purposes: A New Tax System (Australian Business Number) Act 1999 (Cth) (ABN Act), s 8(1)(a). The Commissioner as Australian Business Registrar may cancel an ABN registration if satisfied the person is not entitled to have an ABN: ABN Act, s 18(1).

1. Under s 9-20 of the GST Act, an "enterprise" includes an activity or series of activities done in the form of a business or in the form of an adventure or concern in the nature of trade or on a regular or continuous basis, in the form of a lease, licence or other grant of an interest in property.
2. "Carrying on" an enterprise includes "doing anything in the course of the commencement or termination of the enterprise": GST Act, s 195-1.
3. However, an enterprise does not include an activity or series of activities, done by an individual, "without a reasonable expectation of profit or gain": s 9-20(2)(c).
4. The concept of an "enterprise" is broader than a business. It may extend to activities that would not be considered a business in the ordinary meaning of that expression but are in the form of a business. Mrs Twilley conducted her case on the basis that she was carrying on activities in the form of a business. However, she did not identify any feature of her activities which, although not comprising a business, were nevertheless said to be "in the form of" a business. In any case, it is clear that for activities carried on by an individual to be an enterprise, the activities must still be reasonably intended to be profit making.[1]
5. Nor did Mrs Twilley rely upon any activity said to have been carried out in the course of commencing or terminating a business.
6. Hence, the question for determination is whether Mrs Twilley was carrying on an activity or series of activities in the form of a business. To avoid distracting clutter, references in these reasons to whether Mrs Twilley was carrying on a business should be taken to include whether she was carrying out an activity or activities in the form of a business.
7. The expression "business" is defined inclusively.[2] In this case, it is the ordinary meaning of "business" that is determinative, subject to the extension to include activities "in the form of" a business and the exclusion of activities "without a reasonable expectation of profit".
8. The features that may lead to a conclusion that an activity or series of activities comprises a business are well known. They include the scale of the activity; whether the activity is regular or recurring; an intention to make a profit; the existence of a business plan; and whether the activity is carried on in a businesslike manner. None of these indicia are determinative. An overall assessment of the activities is required. As the High Court has stated:

The existence of a business is a matter of fact and degree. It will depend on a number of indicia, which must be considered in combination and as a whole. No one factor is necessarily determinative. Relevant factors include, but are not limited to, the existence of a profit-making purpose, the scale of activities, the commercial character of the transactions, and whether the activities are systematic and organised, often described as whether the activities are carried out in a business-like manner.[3]

9. Often, when the issue of whether a person or entity is carrying on a business arises, the question is whether the activities are a hobby or private endeavour on the one hand or constitute a commercial activity engaged in for the purpose of profit on the other. This case is somewhat different in that there is no doubt that a commercial activity was carried out. The question is whether Mrs Twilley was carrying on an enterprise. And in particular, whether the Tribunal could be satisfied on the evidence that any activity carried on by Mrs Twilley had a reasonable expectation of profit.

1. As the applicant in a taxation review, Mrs Twilley has the burden of proving the assessments are excessive or otherwise incorrect and what amounts should have been assessed, and that the decisions to cancel her registrations should not have been made or should have been made differently.[4]
2. To discharge that burden of proof, Mrs Twilley must prove that she was carrying on an activity or series of activities in the form of a business.
3. In determining whether Mrs Twilley has discharged the burden of proof, I apply the following principles, as previously summarised by this Tribunal's predecessor:

(a) Facts may be found based on oral evidence alone. There is no barrier to a fact being found on the uncorroborated evidence of an applicant. There is no requirement that direct evidence by oral testimony or affidavit may only be accepted if corroborated.

(b) However, self-serving statements should be closely scrutinised.

(c) Where a taxpayer has received funds or incurred costs [or, I would add, where activities have been carried out] that are not clearly or fully explained in contemporaneous records, the taxpayer may face a challenge in satisfying the burden of proof without corroborating evidence.

(d) However, even in such cases, oral or written evidence of the taxpayer is not to be regarded as prima facie unacceptable. While it will often be prudent to put forward corroborating evidence, taxpayers are not obliged to call all material witnesses or produce all material documents.

(e) The standard of proof is the balance of probabilities. An applicant that succeeds 'in weighing down [the] scales ever so slightly' in the applicant's favour will discharge the burden of proof it bears.

[26] . . . the observations of Logan J in Anglo American Investments Pty Ltd (Trustee) v Commissioner of Taxation noting that informality can and often does attend the formation of legal relations in small business. . .

[27] That is not to say there is any special or lesser standard of proof for a small business. Where informality is present, 'much can depend on the credibility one affords the accounts given by participants and, where they exist, representations in business records created under their supervision or with their approval'.

[28] The Tribunal can only make findings of fact based on the evidence put before it and, where necessary, its relevance explained. Mere assertions will not suffice . . .

[29] Further, the process of finding facts needs to consider the evidence led through the lens of what was, or could be expected to be, capable of being led. As already noted, that does not mean an applicant is obliged to produce every relevant document or potential witness. However, where relevant evidence that could be expected is not produced, that is a relevant factor for the Tribunal to consider.[5]

1. Mrs Twilley and Mr Twilley gave oral evidence in the proceedings. Additionally, the Tribunal had available and considered a significant amount of documentary evidence including bank statements, invoices, a GST detail report and what purported to be deeds of novation.
2. Mr Craig Popplestone also gave oral evidence. Mr Popplestone gave evidence that, in a contractor capacity, he provided business advice and assistance to the RKC group. The assistance included helping to prepare the deeds of novation, and activity statements, as discussed further below.

HAS MRS TWILLEY PROVED SHE CARRIED ON AN ENTERPRISE?

1. In respect of the periods under review, it may be observed that Mrs Twilley returned no taxable supplies at all from 1 September 2019 to 31 December 2020 or in the September 2022 quarter. In each of the other tax periods, other than the December 2021 quarterly tax period, her returned acquisitions exceeded her returned taxable supplies, in some cases by a considerable margin.
2. Over the whole period under review, Mrs Twilley's returned GST totalled $35,826, while she claimed ITCs of $69,338. These numbers indicate that across the period under review the cost of acquisitions made by Mrs Twilley was almost twice the revenue returned.
3. I accept that a business may have periods when they are unprofitable, at times extended periods. I also accept that the performance of a business operating during this period may have been significantly affected by the COVID-19 pandemic.
4. However, Mrs Twilley not disclosing a profit is not confined to this period. In the previous 10 years, Mrs Twilley rarely reported a profit, that is an excess of revenue over expenses, as she acknowledged in cross examination.[6] In activity statements lodged by Mrs Twilley for the tax periods from January 2010 to September 2019, Mrs Twilley's reported creditable acquisitions exceeded sales by over $1.6M.
5. It is unclear from the evidence how a business could be viable while generating losses over such an extended period. Questioned about this, Mrs Twilley was not able to give clear evidence, suggesting "Probably loans, I think, and credit cards" and mentioning loans from friends and family members.[7] That evidence was too vague to allow any specific finding regarding how the alleged business could have survived. But even if Mrs Twilley sourced loans as she indicated, that does not support a finding that there was, despite the pattern of negative returns to Mrs Twilley from her activities, any reasonable expectation of profit at any time.
6. Further, there is no evidence brought to my attention to indicate a basis for a finding that Mrs Twilley intended to carry on an activity with a reasonable expectation of profit at any point in the future during the periods under review. Mrs Twilley's returns indicate that she has not generated any significant profit and has in fact incurred substantial losses over an extended period. Looking ahead from the period under review, there is nothing in the evidence to suggest that pattern was likely to change or that there is any foundation for an expectation that that would have occurred. Mrs Twilley's income tax return for the 2023 income year also reported a loss.[8]
7. The reality is that Mrs Twilley has not generated a significant profit for at least 15 years. There is no evidence that she has ever generated a profit from her activities in any sustained way.
8. Accordingly, based on the evidence before the Tribunal, I am not persuaded that Mrs Twilley carried on any activity with a reasonable expectation of profit. That conclusion is fatal to Mrs Twilley's contention that she was carrying on an enterprise and therefore entitled to be registered for GST; to have an ABN; and to claim the ITCs and FTCs in dispute.

1. However, there are other aspects of the evidence which in any case would lead to the conclusion that it has not been proved that it was Mrs Twilley, rather than Mr Twilley or a company in the RKC group, that was engaged in contracting with customers and carrying on the business activities. I refer to some of these below.
2. First, Mrs Twilley was unable to satisfactorily explain the nature of her purported business or how it interacted with any enterprise carried on by Mr Twilley or other entities in the RKC group. She frequently deferred to Mr Twilley, and to an extent to Mr Popplestone, about the most basic aspects of the alleged business. Overall, her evidence suggested that Mrs Twilley's role was of an administrative nature, and that she also helped out with the physical side of the construction activities carried out by Mr Twilley, delivering materials to sites and the like. The evidence did not indicate that Mrs Twilley was the decision-maker for any business.
3. Secondly, although Mrs Twilley was said to be operating the or a main business of the group and contracting with key customers, it is Mr Twilley, not Mrs Twilley, who holds the relevant Queensland Building and Construction Commission (QBCC) licence. In fact, although said to be operating a business in the construction industry, Mrs Twilley appeared to not even know what a QBCC licence is.[9]
4. Thirdly, the only website for the group's business refers to another entity, not Mrs Twilley or RKC Installations. Further, Mrs Twilley admitted she had never visited the website that promotes what is said to be her own business.
5. Fourthly, Mrs Twilley did not produce the type of business records that one would expect for a business said to be making acquisitions in the order implied by the level of ITCs claimed. No general ledger accounts were produced. While statements for a bank account were produced, the account seems to have been used by the group members indiscriminately and at least to some extent for private expenses.[10] The GST detail report produced was also incomplete and at least to some extent inconsistent with the activity statements.[11]
6. Fifthly, financial and other records explaining the interactions between the entities comprising the RKC group were not produced. Thus, to the extent that there were said to be transactions between Mrs Twilley and group companies - which is unclear from the evidence - there is a lack of clear documentary evidence of such transactions.
7. Two invoices produced, each for $3,000 and purportedly from RKC Installations Pty Ltd, raised more questions than they answered.[12] They purported to charge GST, but that company's GST registration was cancelled well before the dates of the invoices. Mr Twilley could not explain why GST was charged.[13] The invoices called for payment to the bank account that purports to be RKC Installations' bank account. They describe the transaction as for "professional services", but Mr Twilley said they were for leasing and contractors.[14]
8. Sixthly, to the extent that Mrs Twilley sought to explain the absence of records being caused by the Brisbane floods in early 2022, the evidence is unsatisfactory. It is inconsistent with earlier correspondence with the ATO indicating that records were available and could be produced.[15] Further, Mr Twilley gave evidence that records were maintained electronically.[16] Those records should have been available regardless of whether hard copy records were destroyed in the floods, for which, in any case, no evidence in the form of photographs, insurance claims or otherwise was produced.
9. Seventhly, to the extent that purported sales invoices in the name of RKC Installations were produced, that evidence is unreliable. There is evidence, accepted by Mr Twilley, that copies of invoices were altered by whiting out names, explaining why copies provided to the ATO by the customers were inconsistent with those produced to the ATO on behalf of Mrs Twilley.[17] Mr Twilley said that this was done to correct errors, but that does not explain why the errors occurred in the first place if, as Mr and Mrs Twilley asserted, the business was always carried on by Mrs Twilley trading as RKC Installations with Mrs Twilley contracting with customers.
10. Eighthly, purchase invoices produced were mainly addressed to entities other than Mrs Twilley or RKC Installations.
11. Ninthly, retention of title clauses in invoices referred to materials remaining the property of RKC Poles Pty Ltd, not Mrs Twilley or RKC Installations. That is inconsistent with goods and services being provided by Mrs Twilley trading as RKC Installations.
12. Tenthly, the evidence regarding contractors was unsatisfactory. While work was said to have been carried out for RKC Installations by contractors, no evidence of agreements between Mrs Twilley and contractors was produced. Mrs Twilley said that a bookkeeper, Mr Clarke, was a contractor to RKC Installations but his invoices were made out to Mr Twilley of RKC Poles Pty Ltd.[18]
13. Eleventhly, Mrs Twilley provided copies of three purported deeds of novation apparently as evidence that RKC Installations carried out the relevant works rather than RKC Poles which appeared as the original counterparty to the contracts.[19] The copies of the deeds produced are neither signed nor witnessed. They bear dates that would indicate they were signed or to be signed by Mr Twilley on behalf of RKC Poles when Mr Twilley was no longer a director of that company. They bear an address for a property that, at least at the date appearing on one of the deeds, had been sold and the sale settled. The customers were not informed of the purported novations.
14. Based on the evidence provided, the purported deeds of novation were plainly ineffective. Again, the stated desire to correct errors begs the question of why such a fundamental error as to the identity of the contracting entity, in respect of significant contracts, came to occur. Mr Popplestone confirmed that the deeds were created following ATO inquiries.[20]The purported deeds do not assist Mrs Twilley's case. Indeed, Mrs Twilley was unaware of their existence, further contributing to the impression that Mrs Twilley knew little of significant aspects of her purported business undertaking.
15. Twelfthly, the written submissions filed on behalf of Mrs Twilley were of little assistance to the Tribunal. Largely, they either made unsubstantiated assertions or sought to explain away anomalies in the evidence. They did not satisfactorily address the fundamental difficulty for Mrs Twilley that much of the evidence suggested she had limited knowledge of the business she purportedly carried on and that it was Mr Twilley or RKC Poles that was the entity contracting with customers and carrying on any enterprise.
16. For example, the submissions asserted that Mrs Twilley "prepared and lodged BAS reflecting taxable supplies and acquisitions for each relevant quarter". It is true that activity statements were lodged for each quarter. But for the reasons I have indicated, Mrs Twilley has not made good with evidence the assertion that it was Mrs Twilley who made the supplies and acquisitions. The weight of the evidence is to the contrary.
17. Many of the submissions addressed whether activities took place rather than evidence supporting the assertion that it was Mrs Twilley who carried out the activities. For example, Mrs Twilley asserted that "Subcontractor costs were incurred in the ordinary course of delivering the contracted works". That may be true, but leaves unaddressed why the Tribunal should, contrary to the documentary evidence in some cases and in the face of Mrs Twilley's apparently limited knowledge of the purported business, conclude that it was Mrs Twilley who engaged the contractors.[21]
18. In that regard, the submissions also asserted that "On larger engagements the works were governed by deeds of novation". That assertion is not made good. For the reasons indicated above, the purported deeds were not signed or brought to the attention of the counterparty, and on the evidence before the Tribunal were clearly not effective, and Mrs Twilley did not know of their existence.
19. As already indicated, some parts of Mrs Twilley's submissions sought to explain away anomalies in the evidence as one-offs or errors not affecting the substance of the business undertaking. An example is provided by the website which, as indicated earlier, references another entity and which Mrs Twilley said that she had never visited. It is a somewhat startling admission that the purported owner and operator of a small business would not have viewed the business's website.
20. The relevant submission is that "The absence of a dedicated public website or presentation anomalies does not negate the presence of supplies for consideration." Again, that may be true conceptually, but it does not establish that Mrs Twilley made the supplies or explain why the website names another entity when Mrs Twilley trading as RKC Installations is presented as a major entity of the group interfacing with major clients. I accept that errors will, of course, occur, but the difficulty for Mrs Twilley is that the indicators across a range of features, including invoicing and knowledge of the business, point against Mrs Twilley being the owner and operator of a business.

Conclusion - Mrs Twilley has not proved that she was carrying on an enterprise

1. I give full weight to the judicial urgings set out in the principles outlined above relating to the informality that may attend small business operations. However, Mrs Twilley was unable to provide a coherent explanation of the nature of her alleged business, provide basic business records, or, put forward any basis for concluding that, contrary to the long history of her activities, there is a reasonable expectation of profit. Additionally, as mentioned, the weight of the other evidence does not permit a conclusion that it was Mrs Twilley, and not Mr Twilley or RKC Poles Pty Ltd, that was contracting with customers and suppliers and otherwise conducting business activities.
2. In those circumstances, I conclude that Mrs Twilley has not proved that she was carrying on an activity or series of activities in the form of a business at the relevant times. In any case, as noted, the evidence would not support a conclusion that there was a reasonable expectation of profit from Mrs Twilley's activities at any relevant time.
3. It follows that I must conclude that Mrs Twilley has not discharged the burden of proving the assessments of GST net amounts and FTCs are excessive or that the cancellation decisions should not have been made or should have been made differently.

1. The administrative penalty regime (for non-scheme penalties) has been summarised in this way:

4. By s 284-90 in Schedule 1 to the Taxation Administration Act 1953 (Cth) ('TAA'), Parliament has prescribed penalties in what has been described as 'gradations of increasing severity in terms of conduct by a taxpayer or his, her or its agent which has resulted in a tax shortfall'. > > 5. Thus, failure to take reasonable care, recklessness and intentional disregard of the law attract base penalty amounts of 25%, 50% and 75% respectively of the relevant tax shortfall. The applicable base penalty amount is increased by an uplift of 20% where, relevantly, a penalty has previously been applied. > > . . . > > 7. The object of the administrative penalty legislation is stated to be to provide a uniform administrative penalty regime to apply to entities that fail to meet their obligations under taxation laws. Implicitly, it is to encourage voluntary compliance with taxation obligations. > > 8. Under s 298-20 in Schedule 1 of the TAA, the base penalty amount may be wholly or partly remitted where, having regard to all relevant circumstances, it is appropriate to do so.'[22] > > (Footnotes omitted.)

2. As noted earlier, in respect of the periods for which penalties were assessed, the Commissioner calculated the base penalty amounts at the rate for recklessness; that is, 50% of the shortfall in each tax period for which penalties were assessed. Apart from the first such period, the base penalty amount was uplifted by 20% in accordance with s 284-220(1)(c) in Schedule 1 to the TAA.
3. Mrs Twilley bears the burden of proving the penalty assessments are excessive. To do so, she would need to prove she was not reckless in claiming the ITCs and FTCs in her activity statements for each relevant tax period. Alternatively, if Mrs Twilley fails to prove she was not reckless, she may succeed in respect of the penalties by proving the penalties should have been wholly or partly remitted.

Has Mrs Twilley proved she was not reckless in respect of any of the shortfalls for which penalties were assessed?

1. In BRK (Bris) Pty Ltd v Commissioner of Taxation, Cooper J stated:

Recklessness . . .means to include in a tax statement material upon which the Act or regulations are to operate, knowing that there is a real, as opposed to a fanciful risk, that the material may be incorrect, or be grossly indifferent as to whether or not the material is true and correct, and that a reasonable person in the position of the statement-maker would see there was a real risk that the Act and regulations may not operate correctly to lead to the assessment of the proper tax payable because of the content of the tax statement. So understood, the proscribed conduct is more than mere negligence and must amount to gross carelessness.[23]

2. In her closing submissions, Mrs Twilley seemed to rely primarily upon there being no shortfalls that would attract penalties, asserting: "Administrative penalties predicated on 'no enterprise' are not sustainable once enterprise is found on the totality of the evidence."
3. The difficulty for Mrs Twilley is that, on the evidence she gave, she seems to have relied entirely upon Mr Twilley and Mr Popplestone in relation to the preparation of the activity statements. There is no evidence that Mrs Twilley properly checked the activity statements; in fact, the evidence is to the contrary.[24] Further, Mr Popplestone is not an accountant nor is he a registered tax agent.
4. It is also, in my view, important to consider these circumstances in their context. This is not a case of a taxpayer who is new to business where the GST and FTC requirements were not properly understood. Mr and Mrs Twilley had been in business in one form or another for around 20 years when the shortfalls arose. Additionally, the ATO had previously been in correspondence with Mrs Twilley regarding her returns.[25] She must be taken to have had some awareness of the requirements for claiming ITCs and FTCs; if not, her conduct in doing so in the absence of such understanding would have to be regarded as reckless.
5. Further, Mrs Twilley was aware that filing activity statements indicating a higher value of acquisitions than sales would generate refunds. Yet quarter after quarter she allowed activity statements to be lodged that generated payments from the Commonwealth, for negative net amounts and FTCs, apparently without checking the basis on which they were prepared or applying her mind to whether it was likely that taxation laws would permit such outcomes in a construction contracting business over and over again across a period of years.
6. In addition to her assertion that she was carrying on an enterprise, Mrs Twilley also submitted that:

In any event, longstanding registration, regular BAS, audit engagement, rectifications, disaster-driven reconstruction, and conservative apportion [sic] are inconsistent with recklessness.

7. I am unable to see how longstanding registration assists Mrs Twilley and is inconsistent with recklessness. If anything, longstanding registration makes it more, rather than less, difficult to understand how the shortfalls are inconsistent with recklessness. An applicant who has been engaged with the GST system for an extended period ought to be expected to be familiar with its basic requirements and not abdicate responsibility for activity statements to unqualified persons.
8. Likewise, regular lodgement of activity statements does not assist Mrs Twilley especially in circumstances where the lodgements were generating refunds. For a person registered for GST, regular lodgement of activity statements is a base requirement of the law; it says nothing of the care with which Mrs Twilley approached the content of the statements.
9. Audit engagement occurred after the lodgement of the activity statements. Again, that says nothing of the degree of care exercised by Mrs Twilley in the preparation of the statements.
10. I take "rectifications" to refer to the amending or replacing of invoices and the deeds of novation. There was no other evidence drawn to my attention that Mrs Twilley undertook "rectifications". In any case, rectifications undertaken after issues were raised by the ATO again says nothing regarding what degree of care Mrs Twilley exercised when preparing the statements.
11. I take "disaster-driven" reconstruction to refer to reconstruction of records following the Brisbane floods - addressed above - and perhaps also to an embezzlement and non-payment of invoices about which evidence was given on Mrs Twilley's behalf. Even if it is accepted that such events occurred, they do not explain the shortfalls or the degree of care exercised by Mrs Twilley.
12. I accept that "conservative apportion[ment]" of ITC and FTC claims may be inconsistent with an allegation of recklessness. However, it is not clear that Mrs Twilley did take a conservative approach to preparation of activity statements. There is, for example, evidence of an ITC being claimed in respect of private swimming pool expenses.[26]In any case, the issue giving rise to the shortfall is not apportionment of the claims but rather that Mrs Twilley has not established any entitlement at all. That is the basis on which the shortfalls and shortfall penalties arise.
13. For these reasons, I do not find Mrs Twilley's submission in relation to base penalties persuasive.
14. In the absence of evidence that Mrs Twilley personally exercised care in preparing and lodging the relevant activity statements, or engaged a professional person capable of and authorised to assist her with the task, and against the context indicated above, I am not persuaded on the evidence before the Tribunal that Mrs Twilley was not grossly indifferent to the accuracy of the activity statements lodged on her behalf and therefore reckless in her conduct that gave rise to the shortfalls.

Has Mrs Twilley proved the penalty for any tax period should have been wholly or partly remitted?

1. The Commissioner, and the Tribunal on review, has a broad discretion to wholly or partly remit penalties. As Griffith J stated in Sanctuary Lakes v Federal Commissioner of Taxation:

the question [of the remission of penalty under s 298-20 of Sch 1 to the TAA] is ... whether the decision-maker is satisfied having regard to the taxpayer's particular circumstances that it is appropriate to remit [the] penalty in whole or in part.[27]

2. The question the Tribunal is required to ask itself has been stated as follows:

In exercising the discretion under s 298-20(1) to remit, the Tribunal [is] required to ask itself, having regard to the evidence, what were the circumstances surrounding the failure on the part of the taxpayer or its agent to exercise reasonable care [here, intentional disregard of the law] in making the statement to the Commissioner that might explain the conduct the subject of the penalty and what circumstances, on the evidence, ought to be taken into account in determining, as a matter of discretion, that notwithstanding the imposition of a penalty on the taxpayer by the Administration Act on the footing of a failure to take reasonable care [here, recklessness] in making the statement, the penalty ought nevertheless be reduced either in whole or in part, . . .[28]

3. Mrs Twilley submitted that full remission of penalties is appropriate "having regard to longstanding registration, repeated BAS lodgements, and good-faith rectification/reconstruction".
4. I have already addressed these issues above in relation to the calculation of base penalty amounts. For the same reasons discussed in that context, I do not accept that these features make remission appropriate. Having regard to the evidence before the Tribunal, I consider it would be inconsistent with the objective of the penalty regime for the Tribunal to remit penalties in a context where a longstanding GST registrant has wholly abdicated responsibility for preparation of returns to an unqualified person and, so far as the evidence reveals, taken no steps to verify the accuracy of the returns or queried why, tax period after tax period, across several years, she would be entitled to continuously receive payments from the Commonwealth. To remit penalties in those circumstances would, in my view, be inconsistent with the implicit objective of the penalty regime of encouraging due care with the preparation of taxation statements.
5. It follows that I am not persuaded that the penalty assessments are excessive or that remission of the penalties to any extent is appropriate on the evidence before the Tribunal.

1. In view of the conclusions set out above, I must affirm the objection decisions.

[1] Commissioner of Taxation v Swansea Services Pty Ltd [2009] FCA 402, [99].

[3] Spriggs v Commissioner of Taxation [2009] HCA 22; (2009) 239 CLR 1,19 [59].

[4] Taxation Administration Act 1953 (Cth) (TAA), s 14ZZK.

[5] Beta Leigh Pty Ltd v Commissioner of Taxation [2024] AATA 596, [25], citing Imperial Bottleshops Pty Ltd v Commissioner of Taxation [1991] FCA 276; Commissioner of Taxation v Cassaniti [2018] FCAFC 212, Anglo American Investments Pty Ltd (Trustee) [2022] FCA 971, [54].

[21] The same observation applies in respect of the assertion that "The enterprise-maintained [sic] continuity of trading notwithstanding the documented shocks and reconstruction period".

[22] Mitri and Commissioner of Taxation [2024] AATA 1268.

[25] Hearing book, 890 and following; 966 and following.

[27] [2013] FCAFC 50, [249].