Robson and Secretary, Department of Social Services (Social services second review)
[2016] AATA 1012
•1 December 2016
Robson and Secretary, Department of Social Services (Social services second review) [2016] AATA 1012 (1 December 2016)
Division
GENERAL DIVISION
File Number
2016/3446
Re
Sharyn Robson
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Senior Member A C Cotter
Date 1 December 2016 Date of written reasons 9 December 2016 Place Brisbane The decision under review is affirmed.
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Senior Member A C Cotter
Catchwords
SOCIAL SECURITY – family tax benefit – late lodgement of claim - late lodgement of tax return – whether an extension of time can be granted – whether “special circumstances” prevented lodgement within time – where applicant did not know of legislative change – where applicant relied on incorrect professional advice – no special circumstances exist – no special circumstances prevented timely lodgement – decision under review affirmed
Legislation
A New Tax System (Family Assistance) (Administration) Act 1999
(Cth) ss 10, 13, 14A
Acts Interpretation Act 1901 (Cth) ss 28A, 29
Evidence Act 1995 (Cth), s 160
Cases
Hooker and Secretary, Department of Social Services
[2015] AATA 732
Secretary, Department of Social Services and Hollis [2015] AATA 941Groth v Secretary, Department of Social Security (1995) 40 ALD 54
Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9
Wilson and Director-General of Social Services [1981] AATA 88
Andrews and Director-General of Social Security [1983] AATA 248
Milroy and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2011] AATA 488
Field and Secretary, Department of Social Services [2015] AATA 903
Scott v Secretary, Department of Social Services [2000] FCA 1241
Dobson and Secretary, Department of Social Services [2015] AATA 892
Milroy and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2011] AATA 488
Secretary, Department of Social Services and Cannon [2015] AATA 1028
André and Secretary, Department of Social Services [2016] AATA 205
Fedigan and Secretary, Department of Social Services [2016] AATA 211
REASONS FOR DECISION
Senior Member A C Cotter
1 December 2016
INTRODUCTION
My decision and the reasons for my decision were delivered orally on 1 December 2016.
The oral reasons have been transcribed and edited. The following paragraphs are the reasons for my decision.
BACKGROUND
Since the 2008-2009 financial year, Mrs Sharyn Robson has lodged lump sum claims for the Family Tax Benefit (“FTB”).[1]
[1] Exhibit 1, T Documents, T 10, page 88, Letter from Authorised Review Officer to Mrs Robson dated 5 February 2016.
From the 2012-2013 financial year onwards, the timeframe for lodging an FTB lump sum past period claim changed from two years to one year. That meant that for an FTB claim to be considered an effective claim, it was required to be lodged by 30 June of the following year (“lodgement year”). In addition, a claimant and their partner were required to confirm their income by the end of the lodgement year by either lodging their tax returns with the Australian Taxation Office (“ATO”) or advising the Department of Human Services that they were not required to lodge a tax return and providing details of their income for the relevant financial year.[2]
[2] Exhibit 1, T Documents, T 5, page 24, Letter from Department of Human Services to Mrs Robson dated 14 February 2014.
Mrs Robson elected to receive payment of her FTB entitlement for the 2013-2014 financial year via a lump sum payment at the end of the financial year.[3] Under the new timeframe, it was therefore necessary for her to lodge her lump sum claim for FTB for that year by 30 June 2015.
[3] Exhibit 1, T Documents, T 11, page 92, Mainframe screen.
Mrs Robson did not lodge her lump sum claim for FTB for the 2013-2014 financial year until 14 December 2015.[4] On the same day, she and her husband lodged their 2013-2014 income tax returns with the ATO.[5]
[4] Exhibit 1 T Documents, T 8, pages 27- 85, Claim for an annual lump sum payment of Family Tax Benefit dated 9 December 2015.
[5] Exhibit 3, Attachment B to Secretary’s Statement of Issues, Facts and Contentions dated 19 September 2016.
On 21 December 2015, the Department rejected Mrs Robson’s claim for FTB. In doing so, it denied Mrs Robson’s request for an extension of time within which to lodge an FTB claim for the 2013-2014 financial year and to confirm her and her partner’s income for that year, either by lodging tax returns with the ATO or by telling the Department that either or both of them were not required to lodge returns.[6]
[6] Exhibit 1, T Documents, T 9, page 86, Letter from the Department of Human Services to Mrs Robson dated 21 December 2015.
Mrs Robson unsuccessfully sought a review of that decision by an Authorised Review Officer.[7] She then requested a review of that decision by the Social Services & Child Support Division (“SSCSD”) of this Tribunal. That, again, was unsuccessful.[8] She now seeks a review of the SSCSD’s decision by the General Division of this Tribunal.
[7] Exhibit 1, T Documents, T 10, pages 87-91, Letter from Authorised Review Officer to Mrs Robson dated 5 February 2016, together with notes.
[8] Exhibit 1, T Documents, T 2, page 7-12, Decision and Reasons for Decision of the Social Services & Child Support Division dated 13 June 2016.
THE LEGISLATIVE FRAMEWORK
As mentioned earlier, from 1 July 2013, the time for lodging a lump sum claim for FTB for a past period was reduced from two years to one year after the relevant year of claim. Subsections (2) and (2A) of s 10 of the A New Tax System (Family Assistance) (Administration) Act 1999 (Cth) (“Administration Act”) now provide:
(2) A claim for payment of family tax benefit for a past period is not effective if:
(a)the period does not fall wholly within one income year; or
(b)the period does fall wholly within one income year (the relevant income year) but the claim is made after the end of:
(i) the first income year after the relevant income year; or
(ii) such further period (if any) as the Secretary allows, if the Secretary is satisfied that there are special circumstances that prevented the claimant from making the claim before the end of that first income year.
(2A) The further period referred to in subparagraph (2)(b)(ii) must end no later than the end of the second income year after the relevant income year.
Section 13 of the Administration Act goes on to relevantly provide that if a claim is not effective, it is taken not to have been made.
Section 14A of the Administration Act effectively provides that a past period claim for FTB is taken never to have been made if the income tax returns of the claimant or their partner are lodged after the end of the first income year following the past period income year, or such further period as the Secretary allows if the Secretary is satisfied that there are “special circumstances” that “prevented” the claimant from lodging the return before the end of that first income year.
ISSUES FOR THE TRIBUNAL
There is no dispute that Mrs Robson failed to lodge her claim for FTB for the 2013-2014 financial year by 30 June 2015, and that she and her husband failed to lodge their income tax returns for that year by that same date. Therefore, the question which falls for my consideration is whether “special circumstances” existed which prevented Mrs Robson from lodging her lump sum claim for FTB on or before 30 June 2015 and which prevented her and her husband from lodging their income tax returns for 2013-2014 by that date. If no special circumstances existed to warrant an extension of time, the claim would be considered not effective, and taken never to have been made.
Subparagraph (2)(b)(ii) of s 10 of the Administration Act was considered by the Tribunal in Hooker and Secretary, Department of Social Services,[9] in which Senior Member Toohey observed:
In order for the time for making a claim to be extended, the Secretary (and so the Tribunal) must be satisfied, firstly, that circumstances existed that were special and, secondly, that those special circumstances prevented the claimant from making his or her claim within time.
…
There are a number of provisions in social security law concerning “special circumstances”. For example, a preclusion period following receipt of a lump sum compensation payment may be waived or waived if the Secretary thinks “it is appropriate to do so in the special circumstances of the case”…Recovery of a debt may be waived “if there are special circumstances” that make it desirable to do so…
In such cases, it is sufficient for the Tribunal to be satisfied that special circumstances exist. In the case of a late claim for FTB, the special circumstances must prevent a person from making a claim on time. That is a more stringent, two-part test.[10]
[9] [2015] AATA 732 (SM Toohey).
[10] Ibid, [14], [18]-[19]. Statutory references removed.
That decision was cited with approval and followed by Deputy President Humphries in Secretary, Department of Social Services and Hollis.[11] I agree with those decisions, and the two-part approach outlined.
[11] [2015] AATA 941, [30]-[31].
I now turn to the circumstances raised by Mrs Robson in this case.
CONSIDERATION
Mrs Robson’s circumstances
Mrs Robson’s circumstances were set out in her Statement of Issues.[12] They can be summarised as follows:
(a)She had “always known” that the period to lodge her claim and returns for FTB purposes was two years, and hence, she had every intention of doing so before 30 June 2016. Neither she nor her husband were aware of the change in legislation.
(b)Mrs Robson and her husband sought professional advice from their accountant, Mr Aaron Davis, who confirmed that they had two years to meet the FTB requirements. They relied upon that advice to be correct. Like them, Mr Davis was unaware of the change in legislation.
(c)Their accountant had full control of when their tax returns could be lodged and they were “absolutely reliant” on him to lodge their returns with the ATO. Had he been aware of the change in legislation, they are confident that he would have lodged them before 30 June 2015.
[12] Exhibit 2, Mrs Robson’s Statement of Issues (email to the Tribunal dated 23 August 2016).
Before discussing each of those matters, I will make some observations on how the courts and this Tribunal have interpreted the expression “special circumstances”.
What are “special circumstances”?
The expression “special circumstances” is not defined in the Administration Act. However, that expression has been considered extensively by the courts and this Tribunal in the context of both this and other social services legislation. For present purposes, it is sufficient to say that the term generally refers to circumstances which distinguish the particular case from others; there must be something that takes it out of the usual or ordinary case.[13]
[13] See, for example, Groth v Secretary, Department of Social Security (1995) 40 ALD 54 and Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9, [33].
Were Mrs Robson’s circumstances “special”?
The first question to consider is whether Mrs Robson’s circumstances were special.
Unaware of the change in legislation
As I mentioned earlier, Mrs Robson maintains that she was unaware of the change in legislation, reducing the time within which a claim for lump sum past period payment could be made.
In response, the Secretary pointed to the Department’s letter to Mrs Robson dated 14 February 2014, which advised that from the 2012-2013 financial year, she now had one year, instead of two years, to submit a lump sum claim for FTB and to confirm her income for FTB purposes. The letter stressed that it was important to be aware of the reduced period of time “so that you do not miss out on your full entitlements”.[14]
[14] Exhibit 1, T Documents, T 5, page 24, Letter from Department of Human Services to Mrs Robson dated 14 February 2014.
Another letter was sent to Mrs Robson by the Department on 17 April 2014, reminding her of the deadline for the 2012-2013 period.[15]
[15] Exhibit 1, T Documents, T 6, page 25, Letter from Department of Human Services to Mrs Robson dated 17 April 2014.
Mr Davis submitted to the SSCSD that Mrs Robson had no recollection of having received those letters, noting that they related specifically to the 2012-2013 financial year and not the year in question.[16] In her evidence at the hearing before me, Mrs Robson said that she had no recollection of having received the first letter; she may have received the second letter but could not be certain.
[16] Exhibit 1, T Documents, T 2, pages 9-10, Social Services & Child Support Division’s Decision and Reasons for Decision dated 13 June 2016, [13].
The Secretary therefore relied on ss 28A and 29 of the Acts Interpretation Act 1901 (Cth), which effectively operate to deem that a person has received a letter sent by pre-paid post to their last known address unless the contrary is proved. Reliance was also placed on s 160 of the Evidence Act 1995 (Cth), which presumes (unless there is evidence sufficient to raise doubt about the presumption) that a postal article sent by prepaid post to a person at a specified address in Australia was received at that address on the fourth day after which it was posted.[17] Based on those provisions, and in the absence of cogent evidence to the contrary, I am prepared to presume that Mrs Robson received the relevant notices.
[17] Exhibit 3, Secretary’s Statement of Issues, Facts and Contentions dated 19 September 2016, [30]-[32].
Further, the Secretary’s representative pointed to the fact that information concerning the reduced time limit for lodging claims was publicly available on the Department’s website from 23 September 2013.[18]
[18] Ibid, [33] and Attachment C.
In any event, it has long been held that lack of knowledge of the law is not an unusual or uncommon experience that would constitute special circumstances for the purposes of provisions like s 10(2) of the Administration Act.[19] Equally, it is well established that there is no obligation or general common law duty of care to advise recipients, or potential recipients, of benefits that might potentially be available under the Act,[20] or of changes in the law.[21]
[19] See Wilson and Director-General of Social Services [1981] AATA 88; Andrews and Director-General of Social Security [1983] AATA 248.
[20] See Milroy and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2011] AATA 488; Field and Secretary, Department of Social Services [2015] AATA 903; Scott v Secretary, Department of Social Services [2000] FCA 1241.
[21] See Dobson and Secretary, Department of Social Services [2015] AATA 892, [20]; Milroy and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2011] AATA 488.
For those reasons, I do not believe that Mrs Robson’s lack of awareness of the legislative changes constituted “special circumstances”.
Incorrect professional advice
Mr Davis was also unaware of the change in the legislation, and admits that he advised Mrs Robson that she and her husband had a two year period within which to lodge their returns and notify the Family Assistance Office.[22] At the hearing, he initially submitted that the advice was not incorrect, but simply “out of date”. When I questioned him further on that, he conceded that the advice was incorrect.
[22] Exhibit 1, T Documents, T 7, page 26, Letter from One Trust Accountants dated 24 November 2015.
Mr Davis explained that up until about 2009, accountants were actively involved in FTB matters, but after changes in the law, that was no longer the case. If he received queries about FTB, he said that his firm could look it up, but would normally refer clients to Centrelink to check; he did not purport to be fully knowledgeable in the area. He said he could answer basic FTB questions, which presumably included Mrs Robson’s question as to the timeframe for lodging. He felt confident in his answer because he too is an FTB recipient.
Unfortunately for Mrs Robson, had Mr Davis looked further afield to the Centrelink website, he would have discovered the correct timeframe for lodgement. Further, it is important to note that not long after the change in the law, the ATO had informed tax agents of the changes in its Tax Professional Newsletter of 6 November 2013, which was emailed to all registered tax agents.[23]
[23] Exhibit 3, Secretary’s Statement of Issues, Facts and Contentions dated 19 September 2016, Attachment D, Tax Professional Newsletter.
As I mentioned above, it is long established that lack of knowledge of the law is not an unusual or uncommon experience that would constitute special circumstances. Further, it has been held on numerous occasions by this Tribunal that mistakes by a claimant’s accountant cannot properly be regarded as a “special circumstance”.[24]
[24] See, for example, Secretary, Department of Social Services and Cannon [2015] AATA 1028, [23] (DP Constance); André and Secretary, Department of Social Services [2016] AATA 205, [17] (SM Dunne); and Fedigan and Secretary, Department of Social Services [2016] AATA 211, [24] and [29] (Member Ermert).
For those reasons, I do not consider that the error by Mr Davis constitutes “special circumstances” for the purposes of s 10(2) or s 14A of the Administration Act.
Late lodgement of returns by accountant
Mrs Robson contended that had Mr Davis been aware of the change in legislation, she would have ensured that her and her husband’s lodgements were made on time. Similarly, Mr Davis said that had he known the changed timeframe, he would have been able to re-prioritise his tasks for Mr and Mrs Robson and ensure their returns were lodged on time.
Central to this question is once again the incorrect professional advice given by Mr Davis. That raises the same considerations as I discussed earlier. Neither ignorance of the law nor accountant error constitutes “special circumstances” under s 14A of the Administration Act.
Summary – “special circumstances”
Mrs Robson’s application for review contended that I should not follow the series of previous Tribunal decisions referred to me and that rather, I should look only at the words of the legislation (which are not relevantly defined) and its intent. I do not accept that submission. The principles relating to ignorance of the law and errors by third party advisers being no excuse are well established. There is no basis to discount or disregard them here. Further, to do so would not only cause unnecessary uncertainty in decision making, but would also result in unfairness due to inconsistent decisions.
In summary, I do not consider that any of the matters raised by Mrs Robson are sufficient to constitute “special circumstances” for the purposes of s 10(2) or s 14A of the Administration Act.
Did special circumstances “prevent” the lodgement within time?
As I have found that there are no “special circumstances”, it is unnecessary to address the question of whether special circumstances “prevented” the lodgement within time. I would say, however, that there is no evidence before me that suggests that Mrs Robson was prevented from lodging her FTB claim on or before 30 June 2015. Nor is there any evidence that she and her husband were prevented by any circumstances from having their tax returns lodged in the required timeframe.
CONCLUSION
For the reasons outlined, I do not consider that there were any special circumstances for the purposes of the Administration Act. As a consequence, Mrs Robson’s claim for lump sum FTB payment for 2013-2014 was not effective and is taken not to have been made. The decision of the SSCSD was correct.
Accordingly, the decision under review is affirmed.
I certify that the preceding 39 (thirty -nine) paragraphs are a true copy of the written reasons for the decision herein of Senior Member A C Cotter .......................[Sgd].................................................
Associate
Dated 09 December 2016
Date of hearing 1 December 2016 Advocate for the Applicant Mr Aaron Davis Advocate for the Respondent Mr Rick McQuinlan
(FOI & Litigation Branch, Department of Human Services)
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