Bluemore and Secretary, Department of Social Services (Social services second review)

[2015] AATA 623

Bluemore and Secretary, Department of Social Services (Social services second review) [2015] AATA 623 (12 August 2015)

Division	GENERAL DIVISION
File Number	2015/3287
Re	Anita Bluemore
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

DECISION

Tribunal	Regina Perton, Member
Date	12 August 2015
Date of written reasons	24 August 2015
Place	Melbourne

The Tribunal refuses an extension of time in which to lodge an application for review.

[sgd]........................................................................

Regina Perton, Member

SOCIAL SECURITY – late lodgement of application for review – whether reasonable in all the circumstances to extend time - length of delay – reasons for delay – whether applicant rested on her rights - merits of applicant’s case – prospects of success – extension of time refused.

Legislation

A New Tax System (Family Assistance) Act 1999
A New Tax System (Family Assistance) (Administration) Act 1999 ss 32C(3)(b), 107(1)(f)
Administrative Appeals Tribunal Act 1975 s 29(7)

Cases

Hunter Valley Developments Pty Ltd v Minister for Home Affairs and Environment (1984) 58 ALR 305

REASONS FOR DECISION

Regina Perton, Member

12 August 2015

1. The Tribunal provided oral reasons for its decision during the hearing of this application for extension of time on 12 August 2015.  Following the decision, Mrs Bluemore asked if she could have a summary of the reasons to assist her in seeking redress through other avenues.  The reasons for the Tribunal’s decision are summarised below.

2. Anita Bluemore receives family tax benefits (FTB).  She missed out on FTB of almost $6000 for the 2012-2013 financial year because her tax return and that of her husband were lodged four days later than was required by family assistance legislation.  The family’s financial situation is such that the amount foregone is significant.

3. The relevant legislation setting out entitlement to FTB is contained in A New Tax System (Family Assistance) Act 1999 (the Act) and A New Tax System (Family Assistance) (Administration) Act 1999 (the Administration Act).

4. A recipient is required to estimate her/his income and that of their partner at the start of a financial year. Their FTB entitlement is calculated according to that estimate. If they earn more than the estimate, they must repay the amount which was overpaid. If they underestimate, they are entitled to a top up amount. The Administration Act states that they must lodge their tax returns by 30 June of the following financial year to be paid the top up amount.

5. Mrs Bluemore and her husband knew that they were providing relevant records to their accountant only about a week and a half before the deadline.  However the accountant, who was apparently aware of the need to lodge the return no later than 30 June 2014 to enable his clients to receive the total FTB benefit to which they were entitled in the 2012-2013 year, assured them that the firm would be able to meet the tight timeline.  Mr Bluemore contacted the accountant on 30 June 2014 and was told that the return had been lodged that day.  Unfortunately, something went wrong with the accountant’s electronic lodgement system and the return was received by the ATO on 4 July 2014.  The result was that Mrs Bluemore missed out on much of the FTB to which she would have been entitled had the tax return been lodged four days earlier.

6. There is a limited discretion to extend the 12 months for lodgement of the tax returns after the expiry of a particular financial year.  However, while special circumstances can be taken into account, there are other legislative provisions that render such an extension of time to be of no benefit to the potential recipient. 

7. On 30 September 2014 Centrelink, which administers FTB for the Department of Social Services, determined that Mrs Bluemore was not entitled to a top up of her FTB entitlements because the 2012-2013 tax returns had not been lodged by 30 June 2014.  Centrelink sent a letter to Mrs Bluemore on 14 October 2014 advising her of the determination. 

8. On 15 October 2014 Mrs Bluemore sought review of the FTB decision by an authorised review officer (ARO) of Centrelink.  On 21 January 2015 the ARO affirmed the original decision. 

9. On 14 April 2015 Mrs Bluemore lodged an application with the Social Security Appeals Tribunal (SSAT) for a review of the ARO’s decision.  On 21 May 2015 Mrs Bluemore and her husband gave evidence at an SSAT hearing.  On 26 May 2015 the SSAT posted its decision to Mrs Bluemore.  Mrs Bluemore indicated that she received the SSAT’s decision on 28 May 2015.

10. Mrs Bluemore applied to this Tribunal on 30 June 2015.  Section 29(3) of the Administrative Appeals Act 1975 (AAT Act) requires that the application must be made within 28 days of the SSAT’s decision.  Mrs Bluemore applied five days later than is prescribed.   

    SHOULD AN EXTENSION OF TIME BE GRANTED?   

11. Section 29(7) of the AAT Act empowers the Tribunal to extend the time for making an application for review if it is satisfied that it is reasonable in all the circumstances to do so.   The Tribunal generally follows the principles set out by the Federal Court in Hunter Valley Developments Pty Ltd v Minister for Home Affairs and Environment (1984) 58 ALR 305 and subsequent cases. In essence, the Tribunal considers the length and reasons for the delay; whether the applicant rested on her rights; if the lateness prejudices the respondent; and the merits of the applicant’s substantive case. There is little point in granting an extension of time if the relevant facts and/or legislation prevent an applicant from achieving a successful outcome.

12. Mrs Bluemore stated that she had mistaken the date by which the application was to be lodged.  The length of the delay, namely five days, is not significant.  While time limits are in place for sound reasons, the Tribunal is of the view that in a matter such as this one, where a self-represented applicant is dealing with complex legislative provisions in difficult personal circumstances, a few days extension of time could well be considered. 

13. The Secretary conceded that that the Department would not be prejudiced by the short delay in dealing with this matter.

14. The Tribunal considers that the decision on whether to extend time hinges on whether there is any prospect of a successful outcome for Mrs Bluemore. 

15. There is provision in section 32C(3)(b) of the Administration Act to extend the time for lodgement of a tax return if there are special circumstances.   The Secretary’s submission dated 7 August 2015 sets out several cases as to what constitutes special circumstances. The term is not defined in the Act and generally requires something that distinguishes the case from others.

16. The Tribunal notes that Centrelink wrote to Mrs Bluemore on 17 March 2014 to advise that legislative provisions had changed and they must now lodge their tax returns for the 2012-2013 financial year by 30 June 2014 to obtain a top up of their FTB payments. Previously, two years had been allowed for lodgement of the return.  Mrs Bluemore conceded that she and her husband were aware of the need to lodge their tax returns by 30 June 2014.  The Tribunal accepts that there were sound explanations as to why they took some time to provide relevant documents to their accountants.

17. The Secretary’s policy guidelines state that a delay in lodgement caused by the accountant’s electronic lodgement systems cannot of itself be regarded as constituting special circumstances.  The Tribunal would usually follow the guidelines unless it believes that the individual case warrants departure from that policy.  It is possible that a Tribunal might find that there were special circumstances in this case.  If that were the only hurdle to Mrs Bluemore having a successful outcome, the Tribunal may well have granted an extension of time.

18. The situation is further complicated by another provision of the Administration Act, namely section 107(1)(f). The Secretary submitted the following:

    f.The date of effect provisions under subsections 107(1)(f) of the FA Administration Act … prevent a top-up of FTB or supplements where the customer provides new information that would affect their entitlement for an income year more than 52 weeks after the end of that income year.  For example, where an individual lodges their tax return more than 52 weeks after the end of the 2012/2013 income year), and the subsequent reconciliation decision is favourable (i.e. top-ups and supplements would otherwise be payable), the date of effect provisions limit the application of the decision to 1 July 2013.  This means that any arrears arising before this date (for the 2012-13 income year) should not be payable… So, in other words, the Respondent contends:

    iSubsection 107(1)(f) of the FA Administration Act applies to the Applicant.

    iiThe original decision relates to the rate of FTB from 1 July 2012.  Relevantly, in a notice dated 23 June 2013, the rate of FTB was explained on the basis that the base rate only would be paid on the basis of the Applicant wishing to provide further information after the end of the financial year.  The Applicant had therefore notice of the original decision…

    iiiThe review decision will have the effect of increasing an entitlement to be paid FTB during the 2012/2013 financial year.  That is, the potential entitlement was $5968.16 had the Applicant and her husband lodged… 2013 Tax Returns by 30 June 2014…

    ivThe review decision is being made more than 52 weeks after the Applicant received notice of the original decision dated 23 June 2013.

    vThe review decision is being made in the 2014/2015 income year.  The Applicant lodged her 2013 tax return with the ATO in 4 July 2014.

    viThe date that would give full effect to the review decision is 1 July 2012.

    viiAs 1 July 2012 is earlier that 1July 2013 (the first day of the income year in which the review decision was made) the date of effect of the review decision would be 1 July 2013.  This date can have no operative effect on the Applicant’s entitlement to FTB in the 2012/2013 financial year.

19. The Tribunal accepts the analysis put forward by the respondent.  Unfortunately, the operation of  this complicated legislative regime would not result in Mrs Bluemore receiving her top-up payments were the matter to proceed to hearing.

20. Therefore, even if the Tribunal extended the time for lodging the application,  there does not appear to be any positive outcome for Mrs Bluemore.  Therefore, the appropriate decision is to refuse the extension of time. 

21. There is no point in putting Mrs Bluemore through further stress and effort and putting the respondent and Tribunal to additional expense and effort if there is no likelihood of a better outcome.   Had the relevant tax returns been lodged on 30 June 2014 rather than 4 July 2014, Mrs Bluemore would have received the top-up payment.

22. The Tribunal refuses an extension of time in which to lodge an application for review.

I certify that the preceding 22 (twenty-two) paragraphs are a true copy of the reasons for the decision herein of Regina Perton, Member

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Administrative Assistant

Dated 24 August 2015

Date of hearing	12 August 2015
Applicant	In person by telephone
Advocate for the Respondent	Mr Tim de Uray - Human Services