In a decision handed down on 14 November 2012, but only just released, the ACT Civil & Administrative Tribunal increased the level of penalty tax payable by a taxpayer to 50% pursuant to s 31(2) of the Taxation Administration Act 1999 (ACT), but then decided to remit the penalty to 25% pursuant to s 37 of the TAA.
The matter was related to the taxpayer’s failure to pay payroll tax. In November 2011, the Commissioner issued a notice of assessment for payroll tax, 25% penalty tax and interest for the period 1 July 2009 to 30 September 2011. The taxpayer did not object to the payroll tax liability, but argued it was not aware of its liability and relied on its accountant to provide advice. Before the Tribunal, the Commissioner sought to increase the penalty to 50%.
The Tribunal agreed that the rate of penalty should be increased to 50%. However, it also accepted that the taxpayer had taken steps to address the reasons for the default and to ensure future compliance. Accordingly, it decided to remit the penalty to 25%.
(A Plus Plumbing And Building Services Pty Ltd v Comr for ACT Revenue (Administrative Review) [2012] ACAT 76, ACT Civil & Administrative Tribunal, Corby SM, 14 November 2012.)
[LTN 15, 23/1/13]