Tax & ATO News Australia

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A lesson on evidence for the taxpayer

In a fight against the ATO, you are guilty until you prove yourself innocent. You not only need to demonstrate that the assessment made by the ATO is wrong, but also what the correct assessment should be. A fight against the ATO can be lost, even if the ATO is wrong. Getting the right evidence is critical. A recent AAT decision was found in favour of the ATO because:
It is undoubtedly the case that the [ATO’s] assessments are not correct but the [taxpayer] has not shown the taxable income on which tax ought to have been levied.  It follows that he has not shown that the assessments are excessive.
This case was inherently complex with links and ties to an offshore bank in Liechtenstein, In October 2006, an employee of the bank handed over three compact discs to the ATO with details of 20 Australians holding $110 million in the bank. Among one of those Australians was 70 year old retiree, Dr Harold Murray. In June 2008, the ATO used this information to amend assessments of Dr Murray’s income right back from 1999 to 2007 which led to an alarming tax bill of $36 million for Dr Murray.
Dr Murray disputed the assessments on a number of grounds. However, he ultimately lost because he not only failed to produce any documents in support of his contentions, but also failed to appear in the AAT to give evidence. He said that he was concerned about receiving a Departure Prohibition Order like Paul Hogan if he returned to Australia to give evidence.
This case reinforces the importance of presenting the evidence correctly in a fight against the ATO. I have successfully run a number of AAT cases against the ATO and can help you gather and prepare the evidence to put you in good stead in your fight against the ATO.

Posted in: Tax & ATO News Australia at 12 September 12


Tax & ATO News Australia

Author: David Hughes

Last 12 months