The Administrative Appeals Tribunal (AAT) has rejected applications by Taxation Guru Pty Ltd (Taxation Guru) and Mr Gambhir Watts to stay the Tax Practitioners Board (TPB) decisions which terminated their tax agent registration.

Taxation Guru’s registration was terminated following the TPB’s finding that it had failed to comply with the Code of Professional Conduct (Code) by claiming unsubstantiated deductions on behalf of clients. It found the work-related expenses that were claimed were clearly not allowable and unlawful.

Mr Watts, the sole director and supervising agent of Taxation Guru, had his registration terminated following the TPB’s determination that he had ceased to meet ‘fit and proper’ requirements. 

Taxation Guru and Mr Watts filed applications in the Tribunal, seeking review of the TPB’s decisions. In doing so, they also sought to stay the implementation of the decisions pending final resolution of their appeals.  

In rejecting the stay applications, the Tribunal acknowledged that the applicants, and their clients, would suffer some inconvenience, but determined that a stay order would not be in the public interest, finding ‘…the public interest outweighs the detriment which the applicants contend they will suffer if the stay is not granted’.

The Tribunal concluded: ‘…Mr Watts does not appear to have shown any remorse, contrition and an awareness of the significance and consequences of the misconduct or wrongdoing…such that the TPB and the Commissioner can have confidence in the practitioner’s continued ability to honestly and competently discharge the functions of the profession’.

In a previous AAT hearing, Watts v Commissioner of Taxation [2017] AATA 2030, Senior Member Nicoletti found that Mr Watts had submitted deductions for his client which were ‘clearly not permissible under the law’ and found his ‘conduct in claiming deductions which he either knew or ought to have known were impermissible both reckless and inexcusable’. 

TPB Chair, Mr Ian Klug AM, welcomed the AAT’s decision. 

‘The primary objective of the TPB is to protect consumers of tax services and practitioners claiming unlawful deductions put their clients at risk.’ Mr Klug said.

‘Equally we remind the public that they remain legally responsible for the information in their tax return, even if it is lodged by a tax agent.’

Mr Klug said that although the final reviews of the Board’s decisions are still pending, the AAT’s interlocutory decision sends a clear and positive message. 

‘It supports the TPB’s focus on protecting the public, and promotes the integrity of the tax profession.’ 

About the Tax Practitioners Board:

The Tax Practitioners Board regulates tax practitioners in order to protect consumers. The TPB aims to assure the community that tax practitioners meet appropriate standards of professional and ethical conduct. Follow us on Twitter @TPB_gov_au, Facebook and LinkedIn