The AAT has affirmed income tax assessments and penalties imposed by the Commissioner in respect of a taxpayer for the 2002, 2003, 2005 and 2006 income years.
The taxpayer arrived in Australia in 1995 and since then had purchased a property to house his wife and children, and investment properties. The taxpayer was a director of a company (A Co) incorporated in NSW and worked for A Co as a sales agent on commission selling Australian residential property to overseas investors, mainly in Indonesia.
The taxpayer claimed he had spent more than 183 days in each of the relevant tax years outside Australia and accordingly was not a resident of Australia for those years. However, the AAT said the submission was “misconceived” and failed to take into account the provisions of s 6(a)(i) of the ITAA 1936. The Tribunal was satisfied, notwithstanding absences in Indonesia to sell properties, that the taxpayer had his home, or settled place of abode, in Australia and was therefore a resident in Australia.
The next question before the Tribunal concerned withdrawals allegedly made by the taxpayer from bank accounts of A Co (some $194,000 in total). The taxpayer claimed the amounts were reimbursements for expenses. However, the Tribunal noted the accounts of A Co showed the sums as being “commission”. In conclusion, the Tribunal was not satisfied the taxpayer had proved the income assessments were incorrect.
The Tribunal also affirmed the Commissioner’s decision to impose 50% penalty for “recklessness”.
(AAT Case [2012] AATA 119, Re Gunawan and FCT, AAT, Ref Nos: 2010/4223-4225; 2011/2792-2795; 2010/4217-4219, Allen SM, 28 February 2012.)
[LTN 40, 29/2]