Semmens and Commissioner of Taxation (Taxation)
[2023] AATA 2060
•14 July 2023
Semmens and Commissioner of Taxation (Taxation) [2023] AATA 2060 (14 July 2023)
Division: SMALL BUSINESS TAXATION DIVISION
File Number: 2022/0802
Re:Christopher Gerard Semmens
APPLICANT
AndCommissioner of Taxation
RESPONDENT
Decision
Tribunal:Member D Mitchell
Date:14 July 2023
Place:Brisbane
The Tribunal affirms the decision under review.
.........................[SGD].............................
Member D Mitchell
Catchwords
TAXATION – goods and services tax – input tax credits – four year rule to claim input tax credit – notification of entitlement to input tax credits – taxpayer’s burden to prove assessment excessive or otherwise incorrect – decision under review affirmed
Legislation
A New Tax System (Goods and Services Tax) Act 1999 (Cth)
Taxation Administration Act 1953 (Cth)
Cases
Commissioner of Taxation v Travelex Limited [2020] FCAFC 10
Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752
Rosebridge Nominees Pty Ltd (In Liq) v Federal Commissioner of Taxation [2019] AATA 426
SE Sedgwick & YE Sedwick v Federal Commissioner of Taxation [2015] AATA 690
Trustee for the SBM Trust v Federal Commissioner of Taxation [2015] AATA 174, 101 ATR 191
Secondary Materials
Miscellaneous Taxation Ruling MT 2009/1 Miscellaneous taxes: notification requirements for an entity under section 105-55 of Schedule 1 to the Taxation Administration Act 1953
REASONS FOR DECISION
Member D Mitchell
14 July 2023
INTRODUCTION
Mr Christopher Semmens (the Applicant), is seeking review of an objection decision of the Commissioner of Taxation (the Respondent) dated 9 December 2021.[1]
[1] Exhibit 1, T Documents, T2, pages 16-24, Notice of Objection Decision and Reasons for Decision.
The reviewable objection decision disallowed the Applicant’s objection to the Respondent’s decision to retain goods and services tax (GST) refunds claimed by the Applicant for the quarterly tax periods between 1 July 2004 and 30 June 2008 in the amount of $31,062.[2] The Respondent’s decision was made on the basis that the business activity statements (BAS) for those tax periods were lodged outside of the four year time limit.[3]
BACKGROUND
[2] Exhibit 1, T Documents, T2, pages 18-24, Notice of Objection Decision and Reasons for Decision.
[3] Exhibit 1, T Documents, T2, pages 18-24, Notice of Objection Decision and Reasons for Decision.
The Applicant was registered for GST from 1 July 2000 reporting on a quarterly basis.[4] His main business is providing clinical psychology services to chronic pain patients.[5]
[4] Exhibit 1, T Documents, T2, page 21, Notice of Objection Decision and Reasons for Decision and T59, page 139, Applicant ABN Look up – Current and Historical.
[5] Exhibit 1, T Documents, T2, page 21, Notice of Objection Decision and Reasons for Decision.
It is not disputed that the Applicant lodged the BAS for the quarterly tax periods between
1 July 2004 and 30 June 2008 (Relevant Tax Periods) on 12 May 2021,[6] which was more than four years after the end of each of those taxa periods.[6] Exhibit 1, T Documents, T3-T34, pages 25-72, Activity Statement Summaries for the Relevant Tax Periods.
On 11 June 2021, the Respondent completed the GST audit of the Applicant’s BAS for the Relevant Tax Periods.[7] The Respondent decided that the Applicant was not entitled to a refund of the net amounts or credits claimed on his BAS for the Relevant Tax Periods as he did not notify it of his entitlement within four years after the end of the respective tax periods.[8]
[7] Exhibit 1, T Documents, T52, pages 92-98, GST Audit Finalisation Letter.
[8] Exhibit 1, T Documents, T52, page 97, GST Audit Finalisation Letter.
The Respondent disallowed the Applicant’s reported GST credits of $34,023 and also reduced the GST payable amount of $2,961 to nil, resulting in a net audit adjustment of $31,062.[9]
[9] Exhibit 1, T Documents, T52, page 95, GST Audit Finalisation Letter.
On 14 June 2021, the Respondent issued a notice of assessments of net amount (GST Assessments) to the Applicant for the Relevant Tax Periods.[10]
[10] Exhibit 1, T Documents, T53, pages 99-101, Notice of assessment of net amount dated 14 June 2021.
On 21 October 2021, the Applicant lodged an objection against the GST Assessments on the basis that he was not aware of the four year time limit however had made oral notifications of his entitlement to claim GST credits within the required time.[11]
[11] Exhibit 1, T Documents, T55, pages 104-114, Objection.
On 9 December 2021, the Respondent disallowed the Applicant’s objection. The objection decision disallowed the Applicant’s claim for GST credits totalling $34,023 across the Relevant Tax Periods.[12]
[12] Exhibit 1, T Documents, T2, pages 16-24, Notice of Decision and Reasons for Decision.
By way of application lodged on 1 February 2022, the Applicant sought review of that decision by the Tribunal.[13]
[13] Exhibit 1, T Documents, T1, pages 1-6, Application for Review.
A Hearing was held by MS teams on 21 June 2023. At the Hearing the Applicant was self-represented and gave evidence under affirmation.
THE LAW
A New Tax System (Goods and Services Tax) Act 1999 (Cth) (the GST Act) provides that an entity carrying on an enterprise will generally be liable to pay GST on taxable supplies[14] and will be entitled to input tax credits on creditable acquisitions.[15] Amounts of GST and amounts of input tax credits (ITCs) are offset against each other to produce a net amount for a tax period.[16]
[14] Section 9-5 of the GST Act.
[15] Sections 11-5, 11-20 and 11-25 of the GST Act.
[16] Sections 7-5 and 17-5 of the GST Act.
The GST Act requires GST returns for quarterly tax periods to be given as follows:[17]
[17] Section 31-8 of the GST Act.
When quarterly GST returns must be given
Item
If this day falls within the quarterly tax period …
Give the GST return to the Commissioner on or before this day:
1
1 September
the following 28 October
2
1 December
the following 28 February
3
1 March
the following 28 April
4
1 June
the following 28 July
Section 35-5(1) of the GST Act provides that if the assessed net amount for a tax period is less than zero, the Respondent must on behalf of the Commonwealth pay that amount to the entity.
Time limits are imposed on entitlement to refunds and credits.
For the quarterly periods ranging from 1 July 2004 to 30 June 2006, former section 36 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA 1953) applied. Relevantly, section 36 of Schedule 1 to the TAA 1953 provided:
36 Time limit on credits and refunds
(1) You are not entitled to:
(a)a refund under section 35-5 of the GST Act in respect of a particular tax period; or
(b)an input tax credit that is attributable to a particular tax period; or
…
unless:
(e)within 4 years after the end of the tax period, or after the making of the importation (as the case requires), you notify the Commissioner (in a GST return or otherwise) that you are entitled to the refund or credit; or[18]
…
[18] Section 105-55 of the Taxation Administration Act 1953 was amended to apply to all entitlements, including the ones arising from tax periods prior to the amendment. Amendments provided for a transitional arrangement to give taxpayers a six-week time period to lodge their notification beforeFrom 1 July 2006, the statutory time limit for GST refunds and credits was inserted into a new provision that applied to all entitlements including the ones arising from tax periods prior to the amendment. Former, section 105-55 of Schedule 1 to the TAA 1953[19] relevantly provided:
[19] As applies in the present matter.
105-55 Time limit on refunds and credits
(1)You are not entitled to a refund or credit to which this subsection applies in respect of a tax period or importation unless:
(a) within 4 years after:
(i) the end of the tax period; or
(ii) importation;
As the case requires, you notify the Commissioner (in a GST return or otherwise) that you are entitled to the refund or credit; or
(b)within that period the Commissioner notifies you (in a notice of assessment or otherwise) that you are entitled to the refund or credit; or
(c)in the case of a credit—the credit is taken into account in working out a net amount or net fuel amount that the Commissioner may recover from you only because of paragraph 105-50(b).
(2) Subsection (1) applies to:
(a)a refund under section 35-5 of the GST Act or section 61-5 of the Fuel Tax Act 2006 in respect of a particular *tax period; or
(b)an input tax credit or fuel tax credit that is attributable to a particular tax period; or
…
Effectively taxpayers cease to be entitled to a GST refund or credit at the expiry of four years after the end of a tax period unless they notify the Respondent in a GST return or otherwise prior to the relevant expiry date, that they were entitled to the refund or credit.
The Respondent provided the following submission in relation to the requirements for a section 105-55[20] of Schedule 1 of the TAA 1953 notification:[21]
[20] Which equally applies to section 36 of Schedule 1 to the TAA 1953 notifications.
[21] Exhibit 4, Respondent’s Outline of Submissions, page 4-5 paragraphs 22-28.
Requirements for a Section 105-55 Notification
22. The Commissioner sets out his guidance regarding the requirements for a Section
105-55 Notification in Miscellaneous Taxation Ruling MT 2009/1 Miscellaneous taxes: notification requirements for an entity under section 105-55 of Schedule 1 to the Taxation Administration Act 1953 (MT 2009/1).[22]23. There is no specific form[23] that is required for a Section 105-55 Notification, and it does not need be in writing, but it does need to:[24]
a. be received on or before the fourth anniversary of the end of the relevant tax period;
b. assert that the entity has an entitlement to a refund or credit. The assertion must be sufficiently prominent, an oblique reference will not suffice;[25]
i.If a notification is speculative in nature, in the sense that it is directed at reserving an entity’s rights in relation to possible future claims, rather than being directed at one or more particular entitlements, then this will not be considered a notification as it is not specific enough;[26]
[22] MT 2009/1 at paragraph 19.
[23] MT 2009/1 at paragraph 11.
[24] MT 2009/1 at paragraph 23.
[25] MT 2009/1 at paragraph 23.
[26] MT 2009/1 at paragraph 14.
c. provide a description of the entitlement to a refund, other payment or credit, which is sufficient to bring the entitlement to the Commissioner's attention,[27] such that when a subsequent claim is made it could reasonably be identified as being covered by the notification; and
d. specify the tax period(s) or importation(s) to which the entitlement relates.[28]
24. In relation to oral notifications, it would only be in rare circumstances that a statement made orally could sufficiently bring to the Commissioner’s attention the matters necessary for a valid Section 105-55 Notification. This is because there would “potentially be formidable problems of proving the existence of the notification and determining what the parameters of the notification were”.[29]
25. MT 2009/1 provides four requirements of what may constitute a sufficient Section
105-55 oral notification:[30]a. the tax period at issue is identified;
b. the ITCs to be claimed are identified, that is, those in respect of the supplies incorrectly treated as input taxed;
c. the intention to claim the ITCs is notified; and
d. there is a record, preferably contemporaneous, of the notification
[27] MT 2009/1 at paragraph 23.
[28] MT 2009/1 at paragraph 12.
[29] MT 2009/1 at paragraph 22.
[30] MT 2009/1 at paragraph 22A-22B.
(the Four Requirements).
26. In the Full Federal Court case of Commissioner of Taxation v Travelex Limited,[31] Steward J stated at paragraph 138:
…the notification satisfied s 105-55 because it identified the period of the claim (even if it also identified other periods), and the details of the refund claim had been specified as well as the circumstances under which the claimed refund arose.
27. This was applied in the case of Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation[32] where Senior Member Dr Kirk held:
The case law surrounding what the Tribunal considers constitutes a valid Section 105-55 Notification is consistent with the four requirements.[33]
28. Further, Senior Member Dr Kirk found that the Applicant’s conversation with the ATO officer did not provide a valid oral notification.[34]
… it is only in rare circumstances that a statement made orally could sufficiently bring to the Respondent’s attention the matters necessary for a valid Section
105-55 Notification.Accordingly, even if the Tribunal accepts that the Applicant can establish that it made an oral Section 105-55 Notification, the evidence does not support a finding that the parameters of the Notification satisfy the requirements of section 105-55, and accordingly it cannot be satisfied that the notification was valid.
onus of proof
[31] Commissioner of Taxation v Travelex Limited [2020]FCAFC 10 at [138].
[32] Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752.
[33] Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752 at [65].
[34] Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752 at [70].
Where a taxpayer is dissatisfied with a reviewable GST decision, they may make an objection against it in accordance with the requirements set out in Part IVC of the TAA 1953.[35] The Respondent must decide whether to allow, wholly or in part; or disallow, the taxpayer’s objection.[36]
[35] Section 110-50 of the TAA 1953.
[36] Section 14ZY of the TAA 1953.
A taxpayer dissatisfied with the Respondent’s objection decision may apply to the Tribunal for a review of the decision or appeal to the Federal Court against it.[37]
[37] Section 14ZZ of the TAA 1953.
Section 14ZZK(b)(i) of the TAA provides that on application for review of a reviewable objection decision concerning an assessment, the Applicant has the burden of proving that the assessment is excessive or otherwise incorrect and what the assessment should have been.
As such, to be successful in this matter the onus falls on the Applicant to prove that he provided the required notification to the Respondent that he was entitled to the relevant refund or credit within four years of the end of the Relevant Tax Periods.
ISSUES
The issue before the Tribunal is whether or not the Applicant has discharged his onus to prove that the GST Assessments made by the Respondent are excessive or otherwise incorrect, and if so what they should have been.
Given the facts of this matter, the primary question to be considered by the Tribunal is whether or not the Applicant gave valid notification of his entitlement to GST credits within four years after the end of the Relevant Tax Periods.
applicant’s evidence and contentions
The Applicant filed a statement dated 19 April 2022 and provided:[38]
[38] Exhibit 3, Tribunal Book, TB1, pages 1-2, Applicant’s Sworn Statement.
1.During the period that my GST returns (BASS statements) were overdue -from 1 July 2004 to 30 June 2013 - I was operating under some (naive) misconceptions with regard to my obligations:
(i) I thought that because ALL of my GST returns due between these dates were in credit that there was not an urgency to lodge them.
(ii) I did not conceive that I would be subjected to a fine for late lodgement if I were in credit - let alone criminal conviction.
(iii) I considered that I was bearing the cost of not claiming the credits in terms of lost interest etc.
(iv) I was not aware of the 4-year limit of time to claim such credits until I was informed of this by the ATO on 23 January 2018.
(v) During this time I was suffering a psychological disorder related to fear and phobic avoidance of my lodgement obligations, which included income tax returns for this period of time.
(vi) Over this time - in addition to being in significant credit on GST and not claiming it because of the psychological condition with which I was suffering - I was paying, on a weekly basis for much of this time (not all of it), $1,000.00 a week from my overdraft account to (I considered) more than cover any financial obligations and PAYG requirements that I might have had to the ATO in lieu of lodging the tax returns.
2.I was receiving notices from the ATO informing me of the need to make the lodgements.
3.I had numerous telephone conversations with the ATO over this period of time.
4.Informed by the misconceptions detailed above, I would most often make a statement during these phone calls that I was a health professional and that very little of my income was subjected to GST and accordingly ALL of my GST returns would be in credit.
5.In early 2018 (8 January 2018) I contacted the ATO by telephone and asked for a list of the telephone contacts that I had had with the ATO over this period of time. The Applicant’s Statement of Facts, Issues and Contentions dated 3 February 2023[39] and evidence provided at Hearing were consistent with his statement.
6. The list of dates I was given by the ATO on 8 January 2018 of my telephone contact with them was:
March 2006; June 2006; 10 September 2007; 2009; 4 April 2011; 15 June 2011; 3 August 2011; 29 August 2011; 9 February 2012; 13 March 2012 (1); 13 March 2012 (2); 5 September 2012; 16 July 2013; 15 December 2014.
7.On 21 January 2022 [Mr H] of the ATO gave me the additional telephone contact dates:
March 2008; 14 April 2011; 27 May 2011; 11 November 2014.
8.Curiously, most of the dates given to me by the ATO in early 2018 (8 January 2018) were not on the list given to me by [Mr H] on 21 January 2022.
9.While I am unable to specify, in particular, on which of the dates I made the statement referred to in point 4 above, I assert that the statement was made on most (though most probably not all) of the dates above.
10.Given the considerations outlined in point 1 above, it would seem to be objectively reasonable to support an argument that asserts that it would be highly improbable that mention of my GST credit for ALL of my BASS returns would NOT have been frequently made in my telephone communications with the ATO.
11.If the ATO took the view that a verbal notification of my GST credits did not constitute a valid notification it follows that the question is raised as to why I was not informed of this at the time of giving the verbal notification.
12.A possibility is that the ATO officer(s) to whom I was verbally notifying the GST credits were themselves unaware of the 4-year limit.
[39] Exhibit 2, Tribunal Book, TB3, page 12, Applicant’s Statement of Facts, Issues and Contentions.
In addition to the contentions outlined above, at the Hearing the Applicant told the Tribunal:
· It is implausible to say that he would not have talked about the BAS in his conversations with the Respondent.
· That as a health professional very little of his income attracted GST so all BAS were in credit.
· He suspects that the Respondent’s officers were not aware of the requirements of section 105-55 of Schedule 1 to the TAA 1953 and the MT2009/1.
· It is not a necessary condition to establish a valid notification to have known about the notification requirements.
· He is not claiming he made the notifications to meet the requirements but that none the less he made notifications that did meet the requirements.
· This was a long time ago and he can not swear that he made more than three notifications however he did make at least three notifications which were valid notifications for the purposes of section 105-55 of Schedule 1 to the TAA 1953.
· The discrepancy between the dates of telephone contact between his and the Respondent’s submissions suggest that there is an element of unreliability of the Respondent’s documents.
· In relation to the four requirements set out by the Respondent:
1. He identified the tax periods when he said all of them were relevant.
2. Does not apply to him.
3. He does not have records of the notifications however he says he pointed out that he was entitled to refunds.
4. The fact there is no record is an oversight of the Respondent. He made the points – it is implausible that he did not. He talked about the BAS but was in no rush as they were all in credit.
· He maintains, hand on heart that he did make the notifications and believes on the balance of probabilities he did.
· He did not keep any records, the dates of contacts he identified were given to him by the ATO.
· He had an idea of what his BAS results would be.
· He never wanted to cheat the tax system.
At the Hearing, in response to cross-examination, the Applicant:
·Confirmed that he first became aware of the four year requirement in 2018.
·Said that he agrees that the record of 23 February 2018 confirms that he contacted the Respondent about the ability to claim ITCs, but that he does not understand what the record means and does not think it is an accurate reflection of the conversation.
·Said the point he is making is that the Respondent is arguing that he did not satisfy the notification parameters because he did not make the notification in writing, however the fact is that he made verbal notifications and being unaware of requirements does not mean they were not satisfied.
·Said if more information was required than the verbal notification then he should have been told and not doing so is procedurally unfair.
·Agreed he has been part of the tax system for most of his adult life.
·When put to him that the early notifications he says he made were not recorded in the records of his calls with officers of the Respondent because he did not make any such notifications, said, that was untrue. Said, that it is inconceivable or improbable that he would not have made those points, he denies that he never mentioned his entitlement to ITCs.
·When put to him that the records of his contacts with the Respondent did not record any such notifications because he did not know, otherwise they would have been recorded, said that is not the case, the records are inaccurate.
·When put to him that the one time it was recorded was the only time he mentioned it, said he disagreed.
respondent’s contentions
The Respondent contended that no notification was made by the Applicant and as such the exception does not apply and the Applicant’s entitlement to ITCs for the Relevant Tax Periods have ceased.[40]
[40] Exhibit 4, Respondent’s Outline of Submissions, page 3, paragraph 21.
The Respondent provided the following contentions:[41]
29. The height of the Applicant’s evidence is that he made telephone calls to the Commissioner from on or about March 2006 to December 2014.[42] The Applicant relies upon his recollection of his communications with ATO officers several years after the telephone call dates.[43] The Applicant’s case is that these telephone calls constituted valid oral Section 105-55 notifications of an entitlement to ITCs.[44] These facts are disputed by the Commissioner.
30.The Commissioner submits that the ATO’s contemporaneous telephone records, made by ATO officers who spoke with the Applicant,[45] are the best available evidence of what was said between the Applicant and ATO officers. A review of these telephone records demonstrates that none of the Four Requirements in paragraph 25 above were met.
31. The Commissioner submits that the Applicant has not brought to the Commissioner’s attention the period and details of the Applicant’s claim for ITCs within the prescribed time limit in section 105-55 of Schedule 1 to the TAA.
…
35.The Applicant lodged his BASs for the relevant tax periods on 12 May 2021, nine years after the last day of the quarterly tax period ending 30 June 2008. The Commissioner submits the Applicant was no longer entitled to a refund, repayment or credit for that period, as well as the quarterly tax periods before, which had already progressively expired once the four years after the end of each quarterly tax period had passed.
36. The Commissioner submits that the Tribunal has no discretion at law to extend the time limit for the provision of the Section 105-55 Notification pursuant to s105-55(1) of Schedule 1 to the TAA.[46]
[41] Exhibit 4, Respondent’s Outline of Submissions, pages 6-7, paragraphs 29-31 and 35-36.
[42] Exhibit 3, Tribunal Book, TB2, Respondent’s Statement of Facts, Issues and Contentions, pages 8-9, paragraph 29.
[43] Exhibit 3, Tribunal Book, TB1, Applicant’s Sworn Statement, page 2, paragraph, 9.
[44] Exhibit 3, Tribunal Book, TB1, Applicant’s Sworn Statement, page 2, paragraphs 6 and 10.
[45] Exhibit 1, T Documents, T35-T50, pages 73-90 and Exhibit 2, Supplementary T Documents, ST33, pages 189-190, ATO Phone Call Records.
[46] Rosebridge Nominees Pty Ltd (In Liq) v Federal Commissioner of Taxation [2019] AATA 426, 109 ATR 988; Trustee for the SBM Trust v Federal Commissioner of Taxation [2015] AATA 174.
At the Hearing the Respondent contended that:
·The Tribunal cannot be satisfied that valid notification was given as the Applicant was not aware of the four year time limit.
·There is no requirement on the Respondent to advise of obligations.
·The Applicant provided no evidence corroborating that he gave notifications.
·The Applicant gave notice 5 ½ years outside of the time period and there is no discretion to extend that time period.
consideration
While the Applicant contended that he was not aware until January 2018 about the four year time limit in which a BAS must be lodged in order to be entitled to ITCs, he had orally notified the Respondent that he was entitled to the ITCs within time (being within four years from the end of the Relevant Tax Periods), so that the four year rule did not apply to him.
The Applicant did not contend that he at any time sought an extension of time to file his outstanding BAS or that he provided written notice to the Respondent in relation to his entitlement to a GST related refund or credit before the fourth anniversary of the end of the Relevant Tax Periods.
As such, the issue for the Tribunal is whether or not the Applicant notified the Respondent within four years after the end of the Relevant Tax Periods that he was entitled to the refund or credit.
The Tribunal notes that the Applicant gave evidence that he did not keep any records of his contacts with the Respondent during the period in question. The Respondent however provided telephone call records showing that the Applicant made 17 phone calls to the Respondent between 23 March 2006 and 21 January 2022. Only 11 of those phone calls were made within the four year end date for the Relevant Tax Periods. None of those call records provided any indication that the Applicant had given notice to the Respondent relating to his entitlement to claim ITCs.[47]
[47] Exhibit 1, T Documents, T35-T50, pages 73-90 and Exhibit 2, Supplementary T Documents, ST33, pages 189-190, ATO Phone Call Records.
The Tribunal acknowledges that there is a discrepancy between the telephone contacts detailed by the Applicant and those provided by the Respondent. The issue is however that the Tribunal is limited to considering the evidence before it. The Applicant is unable to identify or confirm the dates upon which he says he contacted the Respondent in the absence of a reference being provided by the Respondent.
The Tribunal understands that in relation to the Four Requirements that may constitute sufficient oral notification set out in paragraphs 22A to 22B of MT 2009/1[48] the Applicant contends that:
-His reference was to all outstanding BAS periods.
-There is no issue about incorrectly treated supplies.
-He does not have records of the notifications however he says he pointed out that he was entitled to refunds.
-The fact there is no record is an oversight of the Respondent. He made the point that – it is implausible that he did not. He talked about the BAS but was in no rush as they were all in credit.
[48] The four requirements have been applied in the case of Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752 at [65].
The Tribunal considers that the finding of Senior Member Dr Kirk in Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752 who found that the Applicant’s conversation with the ATO officer did not provide a valid oral notification equally applies in this matter. Senior Member Dr Kirk relevantly provided:[49]
… it is only in rare circumstances that a statement made orally could sufficiently bring to the Respondent’s attention the matters necessary for a valid Section 105-55 Notification.
Accordingly, even if the Tribunal accepts that the Applicant can establish that it made an oral Section 105-55 Notification, the evidence does not support a finding that the parameters of the Notification satisfy the requirements of section 105-55, and accordingly it cannot be satisfied that the Notification was valid.
[49] Messenger Media and Information Technology Pty Ltd and Commissioner of Taxation [2023] AATA 752 at [70].
The onus is on the Applicant to prove that the notice of assessments of net amount for the Relevant Tax Periods is excessive or incorrect, as such it is up to the Applicant to prove that he had made a section 36 or 105-55 of Schedule 1 of the TAA 1953 (as in force at the relevant time) notification in relation to his entitlement to claim ITCs within the four year period from the due date of the relevant BAS.
While it is clear that the Applicant believes that he would have met the notification requirements in relation to the Relevant Tax Periods, even though he was unaware of the existence of the four year time limit or notification requirements, it is unclear what information he actually provided and when. The Tribunal is not persuaded by the Applicant’s evidence in relation to how he says he met the four year notification requirements. The Applicant’s evidence in no way established that any form of relevant notifications were made. This is particularly the case where the Applicant cannot remember with certainty what it is he may have said and when.
Consequently, based on evidence before it, the Tribunal is not satisfied that the Applicant met the notification requirements of sections 36 and 105-55 of Schedule 1 of the TAA 1953 (as in force at the relevant time) in order to preserve his entitlement to ITCs for the Relevant Tax Periods, pursuant to section 35-5 of the GST Act.
There is no discretion for the Respondent or Tribunal to extend the time to lodge a BAS beyond the four year limit unless the requisite notifications took place within the required four year period.[50]
[50] Rosebridge Nominees Pty Ltd (in liq) v Commissioner of Taxation [2019] AATA 426 [42] and Trustee for the SBM Trust v Federal Commissioner of Taxation [2015] AATA 174 [31].
The Tribunal agrees with the position provided in Sedgwick and Commissioner of Taxation [2015] AATA 690 that:[51]
…in circumstances such as these is clear and unambiguous and leaves no room for the operation of a discretion…This may be unfortunate but there are policy reasons that underpin the imposition of such a decisive cut-off date.
[51] Sedgwick and Commissioner of Taxation [2015] AATA 690 at [16].
As such, as the Applicant lodged the BAS for the quarterly tax periods between
1 July 2004 and 30 June 2008 on 12 May 2021, well outside four years after they ended and in the absence of a valid notification, there is no entitlement to claim the associated ITCs for those periods.While the Applicant gave evidence that he was not aware of the four year lodgement requirements for BAS in order to be eligible to ITCs and that he was not told in any of his contacts during the period in question by the officers of the Respondent he spoke to, there is no such requirement upon the Respondent to provide such advice to taxpayers. Information in relation to taxation obligations is made available by the Respondent on its webpage and taxpayers are expected to inform themselves of their relevant obligations.
As the Tribunal has found that the Applicant’s entitlement to the claimed ITCs claimed for the quarterly periods of 1 July 2004 to 30 June 2008 had ceased by the time the associated BAS were given to the Respondent on 12 May 2021, there is no need to consider whether he was entitled to the ITCs claimed during those periods.
conclusion
Based on the evidence before it, the Tribunal finds that the Applicant did not provide a valid notification of an entitlement to ITCs within four years of the end of the Relevant Tax Periods. As such, the exception in sections 36 and 105-55 of Schedule 1 of the TAA 1953 (as in place at the relevant times) is not applicable and the Applicant is not entitled to the claimed GST refund.
The Tribunal does not have any discretion in such circumstances to extend the four-year time period.
As such, the Tribunal finds that the Applicant has not discharged his onus to prove that the assessments of net amount made by the Respondent in relation to the quarterly tax periods between 1 July 2004 and 30 June 2008 as lodged on 12 May 2021 were excessive or otherwise incorrect.
Accordingly, the decision under review is affirmed.
I certify that the preceding 50 (fifty) are a true copy of the reasons for the decision herein of Member D Mitchell
.....................[SGD]......................
Associate
Dated: 14 July 2023
Date of hearing: 21 June 2023 Applicant: By MS Teams Solicitors for the Respondent: Ms Vanessa Bei
Australian Taxation Office
1 July 2008 and preserve their entitlement to seek refunds. Many taxpayers took this opportunity and gave notifications to preserve their entitlement to refunds arising from tax periods starting from 1 July 2000: See Exhibit 1, T Documents, T2, page 19, Reasons for Decision.
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