The Board Conduct Committee (BCC) found that a tax agent had engaged in multiple, serious breaches of the Code of Professional Conduct (Code) and ceased to meet the registration requirement to be a fit and proper person. Based on these findings the BCC terminated the tax agent’s registration. Due to the serious and systemic nature of the conduct, the BCC also applied the maximum five-year ban for reapplying for registration.

The BCC found the tax agent breached:

• Code item 1 - you must act honestly and with integrity

• Code item 2 - you must comply with the taxation laws in the conduct of your personal affairs

• Code item 3 - you must account for money or other property you receive on trust from or on behalf of your clients

• Code item 14 - you must respond to requests and directions from the Board in a timely, responsible and reasonable manner.

The tax agent:

• deliberately misappropriated substantial funds from the estate of a client when they were a trustee, the appointed tax agent of the estate and the sole signatory to the estate’s bank account

• provided financial accounts to another trustee of the estate, which had been falsified in a deliberate attempt to conceal the misappropriation of funds from the estate

• failed to lodge their own income tax returns (ITRs) over multiple financial years and pay outstanding tax debts

• failed to provide an adequate response to a Board request for information, despite being granted multiple extensions.

In their capacity as sole trustee for a trust they failed to lodge multiple ITRs and business activity statements and pay substantial tax debts owed by the trust. These debts included superannuation guarantee charges, that arose as a result of their failure to make payments on behalf of the trust’s employees. The debts continued to accrue and remain outstanding, despite intervention by the Australian Taxation Office, including multiple audits.

While deliberating this case the BCC noted that the tax agent's conduct in misappropriating funds from their client’s estate for their own financial gain demonstrated a serious and inexcusable abuse of their position and a breach of trust. This conduct, and the tax agent’s extended failure to manage their tax obligations and engage with the Board in a timely manner, demonstrated a lack of integrity and a disregard for their professional obligations under the Code. It was also inconsistent with the expectations of a fit and proper tax agent.

In making its decision, the BCC noted that the Board’s role is to ensure consumer protection and that it has an objective to protect and maintain the integrity of the registered tax practitioner profession.