26 Aug 13 TPB says beware when approached to lodge income tax returns on behalf of others
The Tax Practitioners Board (TPB) has recently investigated a number of tax agents who lodged income tax returns containing false payment summaries and other false information. The income tax returns were lodged in the names of genuine taxpayers whose identities had been stolen.
Third parties had approached registered tax agents advising that they were acting on the authority of a number of other taxpayers. The third parties then provided false payment summaries and other false details in organised attempts to defraud the tax system.
The TPB investigated and found that in many instances the tax agents involved had failed to carry out basic checks before lodging the income tax returns. For example, in nearly all cases the tax agents had not made contact with the taxpayers before lodging their income tax returns, or verified any of the information contained within the returns and generally charged higher fees than their normal fee.
Following the conclusion of these recent investigations, the TPB:
- terminated the registration of four tax agents
- suspended the registration of two tax agents, and
- accepted the surrender of another tax agent’s registration.
In addition, the TPB will be lodging applications with the Federal Court seeking civil penalty orders against three agents whose registrations were terminated.
The TPB says that if an agent cannot confirm the details they have been provided with are correct they should explain their responsibility as a registered tax agent and decline to prepare and lodge the income tax returns.
If an agent does not take reasonable care in ascertaining a client’s state of affairs, they may breach the Code of Professional Conduct and could be at risk of breaching a civil penalty provision.