The AAT has remitted a matter to the Commissioner with the direction that a taxpayer be assessed for the 2008 income year as having a taxable income of id=”mce_marker”26,301 and being liable to tax of $37,620.40, together with any necessary adjustment to penalty and interest. It also affirmed a 75% administrative penalty that had been previously imposed on the taxpayer.

The taxpayer had not lodged his 2008 income tax return by the due date of 31 October 2008. On 2 occasions, the Commissioner had written to the taxpayer requesting that he lodge the return. The second letter contained particulars of the estimated capital gain on the sale of a property, which had been sold in the 2008 income year. After failing to lodge the requested return, the Commissioner on 12 September 2012 issued a default notice of assessment for the 2008 income year. (The Tribunal noted the taxpayer had acknowledged that he had received the 2 requests from the Commissioner to lodge his return and had failed to comply with those requests.) That assessment was based on the estimated taxable income of the taxpayer with a 75% penalty. On 16 April 2013, the Commissioner issued an amended assessment, which acknowledged the property, for some time, was the principal place of residence of the taxpayer.

The Tribunal noted that since the amended assessment of 16 April 2013, the Commissioner had recalculated a different amount of tax that was payable. The parties agreed that for the 2008 income year, the taxpayer had a taxable income of id=”mce_marker”26,301 and was liable to tax of $37,620.40. The AAT further noted the taxpayer was now also in agreement with the Commissioner on the proper approach for the calculation of a HELP repayment amount.

The Tribunal accordingly considered the amended assessment should be amended so that the taxpayer would be assessed on the correct amount of tax which was payable by him. The Tribunal also affirmed the administrative penalty of 75% and decided the circumstances did not to warrant remission of the penalty.

(AAT Case [2014] AATA 104, Re QHVV and FCT, AAT, Ref No: 2013/4661, McDermott SM, 27 February 2014.)

[LTN 41. 3/3/14]