A taxpayer has failed to discharge its onus to prove that amended GST assessments were excessive or otherwise incorrect in respect of unexplained bank deposits.

The taxpayer’s main business activity was described as “management consulting services”. The ATO considered that unexplained bank deposits were unreported consideration for taxable supplies. The taxpayer contended they related to loans which had been fully repaid.

This covered BAS’s lodged in the period from September 2016 to September 2018.  The total of bank deposits identified at audit was $1,053,491, with the GST shortfall calculation based on taxable supplies of $598,641. There was some $38,835 of GST in dispute.

The AAT concluded that the taxpayer’s evidence was “limited” on the basis that:

  • there was a lack of independent, contemporaneous and primary source documents which should have been available to the taxpayer to support its contentions;
  • the taxpayer did not call any witness to corroborate its contentions;
  • the material provided by the taxpayer was “brief” and lacked supporting evidence; and
  • that material did not accord with the evidence presented by the ATO in relation to bank deposits and transfers.

Accordingly, the AAT affirmed the ATO’s objection decisions. The taxpayer had not objected to the imposition of penalties, so that aspect was not addressed by the AAT.

(Southern Global Group Pty Ltd and FCT [2021] AATA 3968, AAT, Mitchell M, 28 October 2021.) [LTN 209, 29/11/21]

[Tax Month – November 2021Previous 2021] 6.11.21

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