Ristevski and Tax Practitioners Board - [2019] AATA 5196

Ristevski and Tax Practitioners Board [2019] AATA 5196 (3 December 2019)
Division:Taxation and Commercial Division
File Number(s): 2019/6960
Re:Peter Ristevski
APPLICANT

Tax Practitioners BoardAnd
RESPONDENT

Decision
Tribunal:Mr P W Taylor SC, Senior Member
Date:3 December 2019
Place:Sydney

The following order, made pursuant to section 41(2) of the Administrative Appeals Tribunal Act 1975 (Cth), is desirable and appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.
1Subject to any further order, and subject to paragraph 3 below, the operation of the Respondent’s 19 September 2019 decision terminating the Applicant’s registration as a tax agent is stayed until the decision of the Tribunal on the application for review comes into operation.
2The stay order is subject to the following conditions:-
(a)The Applicant in his personal capacity, and as the sole director of Chan & Naylor Liverpool Operating Pty Ltd, and as the controller of any other entity providing tax agent services, is:-
(i) not to accept any new taxation service clients whilst the stay is in effect, and
(ii) to lodge all required individual, company and trust income tax returns and business activity statements by their due date, or any extended date agreed to in writing by the ATO.
(b)On or before 13 December 2019, the Applicant must inform each of his practice clients, each of the Chan & Naylor Liverpool Operating Pty Ltd employees, and the Board of Chan and Naylor Australia Pty Ltd - by email or letter - of the matters set out in Schedule 2 of these reasons for decision.
(c)On or before 20 December 2019 the Applicant is to provide to the Tax Practitioners Board evidence of his notification to the practice clients, the employees and the Board - either by providing copies of the emails or letters to the Board or by providing a statutory declaration accompanied by a schedule with the name of each person or entity, the date they were notified and the manner in which they were notified.
(d)If any client requests further information about either the 6 September 2016 decision or the 19 September 2019 decision, the Applicant is not (without the prior written consent of an officer of the Tax Practitioners Board) to provide any explanatory information, other than the contents of (one or more of) (i) the 6 September 2016 decision and reasons, (ii) the contents of the 30 September 2019 Tax Practitioners Board letter, (iii) the letters dated 5 April, 14 May and 6 September 2019 that Piper Alderman submitted to the Tax Practitioners Board and, (iv) the Tribunal reasons for decision relating to the making of these orders.
(e)On the Friday of each fortnight, commencing on 10 January 2020 (but excluding public holidays) the Applicant is to provide to the Board a report with the names of any clients who have requested further information and a statement identifying the content of any information provided in response to their request.

3Subject to any further order,…

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.

Keep reading for free

Create a free CaseChat account to read Ristevski and Tax Practitioners Board and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2019] AATA 5196
Decision Date: 3 December 2019

CaseChat Overview and Summary

This matter concerned an application for a stay of a decision by the Tax Practitioners Board to terminate the registration of Mr Ristevski as a tax agent. The dispute arose from findings by the Board that Mr Ristevski had failed to disclose a disqualification under the *Superannuation Industry (Supervision) Act 1993* (Cth), had non-compliance with taxation laws through personal and corporate lodgement defaults and corporate tax debts, and had provided misleading statements about his fitness and compliance in renewal applications and annual declarations. Further issues included allegations of misleading information provided during the Board's investigation, disputed competency in tax agent services, and impropriety in responding to client complaints. The application was heard by Mr P W Taylor SC, Senior Member.

The court was required to determine whether to grant a stay of the Tax Practitioners Board's decision to terminate Mr Ristevski's tax agent registration pending a substantive review of that decision. This involved considering the nature of the statutory scheme under the *Tax Agent Services Act 2009* (Cth) (TASA), which mandates that tax agents be of good fame, integrity, and character, and satisfy probity and repute requirements. The court also had to assess the arguable imprecision of some of the Board's findings, the prospects of success of the substantive review application, the public interest, Mr Ristevski's personal circumstances, and the interests of his employees, clients, and the licensor of his business name.

The Senior Member granted the stay, subject to conditions requiring disclosure. The reasoning acknowledged that while a cautious consideration of the prospects of a favourable outcome in the review proceedings might not always lead to confidence, in cases where the prospects are uncertain but arguable, the focus shifts to the nature of the matter, the interests affected, and the practical consequences of granting or refusing a stay. The TASA scheme aims to ensure tax agent services are provided in accordance with appropriate professional and ethical standards, with registration being a fundamental means of achieving this. Eligibility for registration requires an applicant to be a "fit and proper person," which involves demonstrating good fame, integrity, and character, with considerations including past sanctions for tax-related misconduct or convictions. The decision noted that many of the alleged lodgement defaults and tax debts related to entities where Mr Ristevski had no current control or direct obligation, and that some lodgements had been made prior to the Board's decision.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The September 2016 SIS Act disqualification decision:- Mr Ristevski had not known about the decision until he received the Board’s 20 March 2019 letters. The lodgement defaults and delays:- In relation to himself and the nine other allegedly associated entities identified in the Board’s 20 March 2019 letter as having lodgement defaults:- (a)six of the entities were either mere trustees[4], a superannuation trust fund that was said never to have operated[5], or the trading name of one of the other corporate entities[6], and in each case there was no relevant tax return lodgement obligation.(b)three of the other named entities were either companies of which Mr Ristevski was not a director, or a trust over which he had no control[7] and, leaving aside the position of the company de-registered in 2012, none had current lodgement defaults. (c)Mr Ristevski’s relevant lodgement defaults for his personal income tax returns related to the 2013 and 2014 tax years. They had been lodged in March and April 2015. The 10 month delay involved in lodgement of the 2013 tax return was the result of a combination of business and personal / family pressures, which Mr Ristevski characterised as having occurred in a “calamitous” year. The six month delay involved in the 2014 tax return lodgement was partly because of a mistaken understanding as to when it was in fact due, and partly also because of the same pressures that had contributed to the lodgement delay for the previous year.(d)in every case where lodgements were required, Mr Ristevski believed that they had been lodged and were up to date.[8][4]Chan & Naylor Liverpool Operating Pty Ltd (“C&NOL”), Chan & Naylor Goodwill Pty Ltd, Australian Syndicate Group Pty Ltd and Yellow Brick Road Accounting Pty Ltd.[5]MP Global Investment Services Superannuation Fund. However, the ATO’s 6 September 2016 reasons recorded that the fund had been established on 13 July 2007, and Yellow Brick Road Accounting Pty Ltd had been appointed as the new trustee (apparently replacing two individual trustees, one of whom was Mr Ristevski) on 22 February 2016.[6] Mack Partnership, the trading name of Mack Partners Pty Ltd.[7]They were Mack Partners Pty Ltd, Raptor Motors Pty Ltd (de-registered 24 October 2012) and the Ristevski Family Trust.[8]The lodgement details set out in the Board’s 26 July 2019 submission document to a Board Conduct Committee indicated that (apparently despite the contention in the 5 April 2019 letter that many of the entities were not required to submit returns) a large number of the returns asserted by the ATO to have been outstanding (and returns for tax years 2016 & 2017) had been lodged on 26 & 27 March 2019. The $341,000 tax debt:- This was a debt of Raptor Motors Pty Ltd, a company that had been de-registered in October 2012. (The debt appears to have primarily related to an income tax liability that had accrued by the end of the 2008 tax year.) Mr Ristevski, provided a signed notice of his resignation as a director in November 2004. (At the time of his asserted resignation Mr Ristevski was one of four directors, and a minority shareholder.)

Ratio Decidendi

Legal Principle Established

Often the requisite cautious consideration may not lead to confidence about the real prospects of a favourable outcome of the review proceedings. In those cases the uncertain, but apparently arguable, prospect of a successful review outcome will result in focussing attention on the nature of the matter, the interests affected by the decision, and the practical consequences of granting or refusing any stay.TASA provisions relevant to registration and AGEnts Conduct The basic TASA purpose is to ensure that tax agent services are provided “in accordance with appropriate standards of professional and ethical conduct”:- see TASA s 2-5. (The expression “tax agent services” is broadly defined, and generally includes providing advice and representation services relating to Commonwealth taxation matters:- see TASA s 90-5.) The TASA scheme involves the establishment of the Board, endowing the Board with registration, conduct investigation and disciplinary functions, and the enactment of a mandatory Code for tax agents. The Board administered registration regime is a fundamental means of effectuating TASA’s stated purpose. A person must be a registered tax agent to be able to charge for providing “tax agent services” - unless they do so as a practising lawyer:- see TASA ss 2-10 & 50-5. A threshold eligibility requirement is an applicant’s probity and good repute. An individual registration applicant must satisfy the Board that they are a “fit and proper person”:- see TASA s 20-5(1)(a). A corporate applicant for tax agent registration must satisfy the Board that each of its directors is a “fit and proper person”:- TASA s 20-5(3)(a). Subject to any more specific eligibility requirements, an individual applicant (and any director of a corporate applicant) will likely satisfy the Board they are “fit and proper” if they can adequately demonstrate they are of “good fame, integrity and character”:- TASA s 20-15(a). The considerations that may inform such an assessment are not prescriptively defined:- see TASA s 20-15(b); Toohey v Tax Agents’ Board of Victoria (No 2) [2008] FCA 1796; (2008) 106 ALD 506 at [3]. They must include, but the assessment is neither limited to nor explicitly determined by, circumstances where, in the preceding five years, the person has:-(a)served, or has been sentenced to, a term of imprisonment:- TASA ss 20-15(b)(i) & 20-45(f); 20-15(b)(iii),(b)had the status of an undischarged bankrupt:- TASA ss 20-15(b)(ii) & 20-45(e),(c)been convicted of any offences involving fraud or dishonesty:- TASA ss 20-15(b)(i) & 20-45(b), and(d)been convicted of, or otherwise sanctioned for, a “serious taxation offence” or certain other kinds of tax related misconduct:- TASA ss 20-15(b)(i) & 20-45(a), (c) & (d). The registration eligibility criteria for an individual tax agent include appropriate qualifications, experience and professional indemnity insurance:- TASA s 20-5(1)(b) & (c); Tax Agent Services Regulations 2009 (Cth) reg 8. The similar eligibility criteria for an incorporated tax agent entity include (i) not having incurred a conviction for fraud, dishonesty or a “serious taxation offence” within the preceding five years, (ii) having sufficient registered individual tax agents to provide (and supervise the provision of) competent tax agent services and, (iii) having requisite professional indemnity insurance:- TASA s 20-5(3).