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ICA starts legal battle with the ATO on two fronts

Thursday, September 29, 2016

At ICA, we’ve been complaining to the ATO for years about its bad treatment of small business people. We’ve made major submissions to tax inquiries. Look at this long list. We’ve tried to work with the ATO but there’s been no change!

So now, thanks to some brilliant lawyers, we’re off to court. Here’s an overview of the case we described in March this year.

Finally, we can give some details. It involves 55-year-old IT contractor Rod Douglass, his wife and their partnership and a demand from the ATO for $550,000 backdated to 2006 (10 years!). Rod is accused of tax evasion. Why? Because he complied with ATO tax advice published on the ATO website. Amazing!

This treatment by the ATO can hit anyone working for themselves. Even if you’re totally honest with the ATO, they can and do target you. We’re out to protect Rod. We can’t let him be beaten up by the ATO without helping. We’ve filed in the Federal Court and the Administrative Appeals Tribunal. There’s a lot of information that we’ll release as the lawyers authorize it.

However, Robert Gottliebsen has given some details and commentary in The Australian today. His article is here. Read the article so that you understand how anyone could be hit!

Robert says:
  • …the reason for the bad (ATO) culture is the fact the … tax officials are investigator, prosecutor, judge, jury and appeal court.
  • It was the inescapable intention of the tax officials to bankrupt him (Rod).
  • The precedent could … destroy many husband and wife partnerships around the land.
  • Chris Jordan (The Tax Commissioner) should consider admitting that he has a cultural problem in his middle ranking staff.

Robert’s article gives some details of Rod’s case. ICA will keep you updated and publish much more detail here as events unfold.


Anonymous commented on 10-Jan-2017 12:58 PM
Years ago we did a paper for the ACT Government on introducing fully limited liability partnerships starting with the history of limited partnerships in 12th century. Amalfi. Federal Treasury didn't wait and taxed them as companies. We could have been ahead of California and London for venture capital but, no, we couldn't have that.

Australia is not a country which has a tax authority: it is a tax office which has a country, if I may adapt a saying about the 19th century Prussian Army.

An out of control military or civil service does itself, its country and its government no service at all.

Dr Terry Dwyer
Dwyer Lawyers

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