The AAT has held the taxpayers’ circumstances and actions did not warrant a remission of penalties in relation to not remitting the appropriate GST amounts to the Commissioner on the sale of residential apartments.
The taxpayers were members of a partnership that developed residential apartments for sale. For the period February 2009 to August 2010, the partnership generally lodged BASs which claimed input tax credits but did not report the sales of the apartments. The Commissioner audited the taxpayers and determined a GST shortfall amount of $534,018. He then imposed penalties of $460,447.95 (75% base penalty for “intentional disregard” with a 20% uplift). The taxpayers argued that the penalties should be imposed at a lower value under s284-90 of Sch 1 of the TAA due to, among other things, their lack of business experience (or remitted under s298-20 of the TAA1).
The Tribunal noted that one of the taxpayers involved was a qualified accountant with a number of years’ experience and was “well familiar with the obligation to account for GST”. Therefore, it rejected the taxpayers’ arguments and held that there was “nothing in the [taxpayers’] circumstances which suggest that remission is warranted”.
(AAT Case [2012] AATA 703, Re Subloo’s Investments Pty Ltd & Ors and FCT, AAT, Hack DP, AAT Ref: 2012/069; 2012/4374-75, 11 October 2012).
[LTN 199, 15/10]