T T Lam and HT Ngo and Commissioner of Taxation (Taxation)

This proceeding concerned the liability of a partnership, T T Lam and HT Ngo, to an administrative penalty for failing to withhold amounts under the Pay As You Go (PAYG) withholding provisions. The Commissioner of Taxation contended that these failures occurred in relation to payments made under a labour hire arrangement between 1 July 2004 and 30 September 2008. The partnership also sought further remission of the penalty. The matter was heard by Deputy President F J Alpins P.

The legal issues before the Tribunal included whether the applicant partnership was liable for the penalty for failing to withhold PAYG amounts from payments made under a labour hire arrangement, and if so, whether further remission of that penalty was warranted. Crucially, the Tribunal was required to determine whether the applicant had discharged its burden of proof in demonstrating that the Commissioner's remission decision should have been made differently.

The Tribunal applied the principles concerning the onus of proof under section 14ZZK(b)(ii) of the *Taxation Administration Act 1953* (Cth). This provision places the burden on the applicant to prove that a remission decision should not have been made or should have been made differently. The applicant had to establish that they were not required to withhold, or that they withheld lesser amounts, or that the penalty ought to have been remitted to a greater extent than it was. The Tribunal noted that the Commissioner bears no onus to justify the remission decision.

Ultimately, the Tribunal found that the applicant had failed to discharge the burden of proof under section 14ZZK(b)(ii) of the *Taxation Administration Act 1953*. Consequently, the Tribunal affirmed the Commissioner's objection decision.