The Board Conduct Committee (BCC) considered the case of a tax agent who was alleged to have fraudulently obtained ATO refunds by lodging returns for people who were not clients of their tax practice. 

Our investigation found the agent had breached multiple code items, including:

• failure to act honestly and with integrity by:

  • adding clients without their knowledge or consent 

  • obtaining money they were not entitled to

  • lodging income tax returns (ITRs) and business activity statements (BAS) for people without their knowledge or consent 

  • making a false and misleading statement to the Board in an application for renewal and multiple annual declarations 

  • using potentially falsified invoices to fraudulently obtain GST refunds for a client, resulting in substantial penalties and tax shortfalls being applied to that client

• not complying with taxation laws in the conduct of their personal affairs and those of associated entities by not lodging five ITRs, 35 BAS and not reporting pay as you go (PAYG) withholding amounts 

• failure to ensure tax agent services were provided competently by not:

  • meeting several deadlines for completion of PAYG withholding and superannuation guarantee charge statements for a client, resulting in a shortfall of around $124,000 with almost $73,000 in penalties imposed

  • reporting a client’s BAS correctly, resulting in a shortfall of over $11,000 with over $8,500 in penalties imposed 

• obstructing the proper administration of tax laws by influencing, or attempting to influence, witnesses of an investigation to give false evidence to the Board. 

The BCC decided to terminate the tax agent registration. Due to the serious nature of the conduct and the outstanding tax obligations, the BCC also prohibited the agent from applying for registration for a period of five years.