Plaskitt and Tax Practitioners Board - [2022] AATA 267

Plaskitt and Tax Practitioners Board [2022] AATA 267 (18 February 2022)
Division:TAXATION AND COMMERCIAL DIVISION
File Number: 2019/7312
Re:Richard Geoffrey Plaskitt
APPLICANT

Tax Practitioners BoardAnd
RESPONDENT

DECISION
Tribunal:Mr Rob Reitano, Member
Date:18 February 2022
Place:Sydney

I affirm the decisions of the Board.
.....................................[sgd]...................................
Mr Rob Reitano, Member
CATCHWORDS
Termination of registration as tax agent – non-application period of 5 years imposed – contraventions of the Code of Professional Conduct – applicant failed to comply with taxation laws in the conduct of its personal affairs – misappropriation of funds – decisions affirmed
LEGISLATION
Tax Agent Services Act 2009 (Cth)
CASES
Ridden and Tax Practitioners Board [2020] AATA 422
REASONS FOR DECISION
Mr Rob Reitano, Member
18 February 2022
Introduction

On 16 October 2019 the Tax Practitioners Board (Board) told Richard Geoffrey Plaskitt (Mr Plaskitt) it had decided on 3 October 2019 that Mr Plaskitt’s registration as a tax agent was to be terminated because the Board not satisfied he was a fit and proper person under subparagraph 20-5(2)(a)(ii) of the Tax Agent Services Act 2009 (Cth) (Act). The Board also decided that Mr Plaskitt would be prohibited from applying for registration for a period of five years. The decisions were to take effect from 18 November 2019.
The decisions followed adverse findings that were made after an investigation into the partnership of which he was the sole supervising agent and a partner which was known as Danielle Elizabeth Plaskitt and Richard Geoffrey Plaskitt (Partnership). Danielle Elizabeth Plaskitt (Mrs Plaskitt) was the other partner of the Partnership and Mr Plaskitt’s wife.
Mr Plaskitt has asked the Tribunal to review the Board’s decisions to terminate his registration and to impose a non-application period of five years.
I have decided to affirm the Board’s decisions and what follows are my reasons for doing so.
How did the matter come to the Tribunal?
The Act provides a scheme for the registration of taxation agents which has as one of its core objectives making sure that taxation services are provided to the public with appropriate standards of professionalism and ethics. That object is achieved both by providing minimum ‘eligibility requirements’ for those who seek and have registration and by providing for other sanctions against those who breach prescribed standards of conduct.
An important eligibility requirement for registration that must be maintained whilst a person is registered is that a person be a fit and proper person. If a person is registered but subsequently ceases to meet an eligibility requirement, their registration as a taxation agent can be terminated. If a person’s registration is terminated because they are not a fit and proper person to be registered as a taxation agent, the Board can also prescribe a period up to five years during which they are precluded from seeking registration again.
I have already referred to the Board’s decision by which it was not satisfied that Mr Plaskitt was a fit and proper person to be a taxation agent. The reasons for…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Plaskitt and Tax Practitioners Board

Details

AGLC: Plaskitt and Tax Practitioners Board [2022] AATA 267
Case: [2022] AATA 267
Decision Date: 18 February 2022

CaseChat Overview and Summary

This matter concerned an application for review of decisions made by the Tax Practitioners Board to terminate the registration of Mr Plaskitt as a tax agent and to impose a non-application period of five years for re-registration. The dispute arose from allegations that Mr Plaskitt had contravened the Code of Professional Conduct, including failing to comply with taxation laws in his personal affairs and misappropriating client funds. The review was heard by Mr Rob Reitano, Member, of the Administrative Appeals Tribunal.

The Tribunal was required to determine whether Mr Plaskitt was a fit and proper person to be a registered tax agent, a prerequisite for registration under the relevant Act. This involved assessing whether he possessed good fame, integrity, and character, and considering the professional responsibilities of a tax agent who acts as an intermediary between clients and government bodies, requiring both competence and honesty. The Tribunal also had to consider whether to impose a prohibition on Mr Plaskitt reapplying for registration and, if so, for what duration.

The Tribunal found that Mr Plaskitt, as the sole supervising partner of a partnership, allowed the partnership to misappropriate funds from a client, Dr Cosford, by making unauthorised loans to the partnership and to two stepdaughters. While not making specific findings on all allegations due to a lack of detailed submissions, the Tribunal concluded that these actions, combined with Mr Plaskitt's failure to rectify his and the partnership's personal taxation affairs and his denial of dishonest conduct, demonstrated a lack of fitness and propriety. Furthermore, a prior formal written caution for breaches of the Code, including lodgement failures and outstanding debts, was considered relevant. The Tribunal determined that a five-year prohibition on reapplication was appropriate, primarily to protect the public and deter future misconduct, given the seriousness of the conduct and Mr Plaskitt's apparent lack of understanding of his obligations regarding conflicts of interest.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

In the end, because of the lack of evidence before me about these matters and because they were not addressed in any detail in submissions, I do not make any findings about them.Failure to provide evidence and respond Like with the previous allegation, no detailed submissions were directed to this allegation by the Board. The allegation was by breaching of the requirement to respond to requests and directions from the Board in a timely, responsible and reasonable manner which concerned the failure to provide supporting evidence for a request for an extension of time to respond to the Board’s letter of 20 May 2019 and a failure to provide a response to the letter of 20 May 2019 by the requested date. The response to the letter of 20 May 2019 was required by 7 June 2019. It was not provided by then. Although the allegations do appear on the face of things to have been made out because of the lack of attention given to the matters during the hearing, I do not intend to make any finding about this allegation. Is Mr Plaskitt a fit and proper person? A person is only eligible to be registered as tax agent if the Board is satisfied that the person is ‘a fit and proper person’. On this review, it is the Tribunal that stands in the shoes of the Board in making that evaluative judgment about whether it is satisfied that Mr Plaskitt is a fit and proper person. The Act specifically requires that in addressing the question of whether a person is a fit and proper person, the Board, in this case the Tribunal, must have regard to whether the person is of good fame, integrity and character. That of course does not limit the matters that can be considered, but simply requires that matter in particular to be taken into the assessment. In general, it is accepted that the phrase ‘fit and proper’ in itself has no exact meaning. In the context of tax agents, the question is generally addressed by having regard to the fact that a tax agent is someone who prepares and lodges tax returns on behalf of others, most usually clients. Such a person needs to be both competent and honest because they are trusted to take care of the affairs of other people. A tax agent is an intermediary with government officials, most usually those working in the ATO. So too then must those officials have confidence that the agent has acted not only competently but also honestly. A fit and proper person in general is of such character that they carry out their affairs professionally. I have found that Mr Plaskitt, as the sole supervising partner of the Partnership, allowed the Partnership to misappropriate the funds of Dr Cosford. I have found that the Partnership made loans from Dr Cosford’s money to itself and to two of the stepdaughters of Mr Plaskitt without the authority of Dr Cosford. I have found that Mr Plaskitt allowed these things to happen whilst he was involved in the Partnership as the sole supervising partner. These are serious matters that ultimately affect a person’s fitness and propriety, especially the former as it involves dishonesty or, so far as Mr Plaskitt was concerned, at least, allowing the Partnership to engage in conduct that was dishonest. In that light, it is relevant that Mr Plaskitt denied that anything dishonest had happened so far as the payment of the Partnership’s tax debt was concerned and so far as the payments to Mrs Plaskitt were concerned. These things strongly suggest that I cannot be satisfied that Mr Plaskitt is a fit and proper person to be a registered tax agent.

Decision

Reasons for decision

In these circumstances, I consider that a prohibition on reapplication for registration for a period of five years is appropriate. I note in that regard it will be necessary for Mr Plaskitt to make an application and for the Board to be satisfied that he is a fit and proper person at that time before he can obtain re-registration. It is hoped by then that Mr Plaskitt will have his house in order and will have done things put himself in a position to demonstrate to the Board that things have changed for the better.Decision I affirm the decisions of the Board.

Ratio Decidendi

Legal Principle Established

Having regard to this consideration, I am not satisfied that Mr Plaskitt is a fit and proper person so that his registration as a registered tax agent should be terminated. Should Mr Plaskitt be subject to a prohibition upon reapplying for registration? The matters that I have found are serious in particular so far as the payments to the partnership’s ATO accounts and to Mrs Plaskitt are concerned. Those payments were for significant amounts. The making of unauthorised loans is equally a serious matter. Both of those things combined with Mr Plaskitt’s abject failure to get his personal taxation affairs in order, as well as those of the Partnership, are serious matters such that I am satisfied that there should be a prohibition imposed upon Mr Plaskitt reapplying for registration. The length of time of that prohibition is a difficult one in this case because the seriousness of the matters is accompanied by two other significant things. First, there is the complete lack of any acknowledgement of wrongdoing in respect of the issue of conflict of interest and almost complete lack of understanding about what that involved. Although Mr Plaskitt said that he regretted that his personal tax affairs and the Partnership’s tax affairs were not up to date even at the time of hearing him about the length of time of any preclusion period for reapplication, he had done nothing to rectify those things. Actions speak louder than words. He continued to deny the allegations involving Dr Cosford’s funds. Second, on 17 February 2017, the Board issued a formal written caution to Mr Plaskitt for breaches of the Code that involved the failure to lodge the 2015 Partnership return in time, the failure to lodge four BAS in time and having an outstanding debt to the ATO. The caution warned that suspension or termination might be the product of further contraventions. There is no formula to be applied in determining an appropriate period for prohibiting an application for registration although there is a maximum period of five years. The matter is very much one of impression and judgment having regard to all of the circumstances. It necessarily has regard to the seriousness of the conduct in question and the need to deter the particular individual and other registered tax agents more generally from engaging in misconduct. The primary matter to which any prohibition from reapplication is directed is the protection of the public. Although the dishonest conduct in the circumstances cannot be found to be directly that of Mr Plaskitt, it is relevant in assessing the seriousness of the matter more generally that dishonesty is at the core of the main allegation. I have found Mr Plaskitt allowed that conduct to take place. I have serious concerns as well about Mr Plaskitt’s understanding of his obligations so far as conflicts of interest and managing them are concerned. His abject failure to assist the Tribunal get to the bottom of the unauthorised loans only suggests that there can be little confidence that he will in future adhere to his relevant obligations.