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MEMBER 1 writes:

"I wish to comment on the poor technical ability and quality of the some of the staff currently employed by the ATO. I have found my recent dealings with ATO staff to be quite unsatisfactory. I have found that many questions asked by me or my staff have been met with an “off the cuff” answer with little or no thought given to the responses given to our enquiries. Some examples:

1. FBT Questionnaires - we completed a number of FBT questionnaires and posted them to the specific PO Box noted in the ATO letters. This was done by the deadline date in the ATO letters in December 2007. Over a year later we have heard nothing. Zip. Zero. No letter, phone call, nothing. One of my staff followed up the progress in May 2008. The ATO staff member noted on one of the letters told my staff member “we never got them”.

Does anyone find it strange that the ATO would not follow up a response to their letters between the deadline date of December 2007 and May 2008? We did not send copies to them and I have refused to follow it up again.

2. FTB Claim - one of our clients had a significant FTB claim for the June 07 year and the June 08 year. We completed both returns recently and the June 07 claim was paid promptly. Our client split up from her husband during the June 08 year, and the claim for that year was refused due to an incorrect date in the June 08 tax return. The ATO wrote to us and asked that we complete the FTB claim again on a paper form. Reluctantly we completed the paper form, posted it and followed up its progress a few weeks later. ATO staff member #1 told one of my staff “We are not going to process the paper form. The client will have to go into Centrelink and sort it out with them direct”. A few phone calls later, and ATO staff member #2 told my staff member that ATO staff member #1 got it wrong and that the ATO would process the paper form forthwith. About a week later our client received her $11,000 FTB.

3. Estate Tax Return - we lodged a number of income tax returns for a deceased estate. Each of the assessments was issued promptly except for the one in respect of the fourth year. As readers may be aware, an estate return is entitled to lower concessional rates of tax for the first three years after the date of death, but may be subject to tax at the highest marginal rates for the fourth and subsequent years. Six months after the estate was wound up we received an assessment for the fourth year. We objected. The notice of the decision on the objection was received just before Christmas with these gems in the letter from the ATO:

“Should the Commissioner exercise his discretion to apply the lower rates of tax...etc? No”.

“In cases where the Commissioner exercises his discretion...the net income of the estate is assessed under s 99 of the ITAA 1936 and the more concessional rates of tax apply”.

“It is considered that there is no discretion available to the Commissioner to extend the three year period to apply the lower rates of tax...Accordingly your objection has been disallowed in full”.

I rang the ATO staff member noted on the letter, and pointed out that HIS OWN LETTER had spelt out that the Commissioner DOES have the discretion to apply the lower concessional rates of tax. After helping the ATO staff member navigate around his own letter, I asked could he please re-read my objection and decide whether the reasons I gave warranted the Commissioner to exercise his discretion. He replied “you’ll just have to write another letter. This is my last week in this section and someone else will look at it”.

I find these examples most disappointing and unacceptable behaviour by the ATO staff members. In each of the examples, the ATO staff member has given an “off the cuff, I want to hang up now, you go and write another letter” style answer which as you would agree is most unhelpful. They have no concept of how much of our valuable time they waste.

We are approaching another series of compliance deadlines. When these clients are fined for lodging their returns late, I wonder if the ATO will accept the fact that we’ve had to fill in manual forms and write letter after letter as valid excuses to have the penalties and GIC remitted. I’ll probably get a reply that the Commissioner doesn’t have the discretion to remit a penalty or the GIC."

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