Issued: 21 September 2021
Last modified: 21 September 2020
Date of decision: 6 August 2020
A tax agent was found to have made false declarations in annual returns that she lodged with the Australian Taxation Office (ATO) on behalf of self-managed superannuation funds (SMSF), including a SMSF of which she was a trustee.
The agent prepared and lodged annual returns for three SMSFs for the 2013 to 2015 financial years, falsely declaring in each return that a particular SMSF auditor had audited the SMSF for the relevant year, when no audits had in fact been completed and agent knew that those SMSFs had not been audited.
The agent had also attempted to mislead the ATO in response to their enquiries about the false declarations.
The agent provided the ATO with documents relating to annual returns and SMSF independent auditor’s reports for two of her SMSF clients for the 2013 year, which indicated that she had audited and completed reports for those SMSFs. The agent also stated to the ATO that she believed she was able to audit those SMSFs in her role as a member of a recognised professional association. However, despite making those statements, the agent had in fact lodged those returns falsely declaring that the SMSFs had been audited by another auditor (when no audits had been completed). The agent was also aware that at that time, she was not an approved SMSF auditor and therefore was not lawfully permitted to conduct SMSF audits.
By her conduct, the agent had also misled the trustees into believing that their SMSFs had been audited when that was not the case. By lodging these returns, she also falsely reported to the ATO that those trustees had given her declarations that the information provided to prepare the returns was ‘true and correct’, when she knew that those returns contained false statement about the completion of audits by an approved SMSF auditor.
In 2019, the ATO disqualified the agent from being or acting as a trustee, responsible officer, investment manager or custodian of all superannuation entities under the Superannuation Industry (Supervision) Act 1993 (SISA).The ATO had found that her related superannuation entities had engaged in serious breaches of the SISA on multiple occasions and that she was not a fit and proper person for the purposes of the SISA.
In addition to the above conduct, the agent also had failed to ensure that companies and SMSFs for which she was responsible lodged their annual returns and business activity statements and paid their tax debts on time.
Termination with two-year ban
The Board Conduct Committee (BCC) determined that the agent had ceased to be a fit and proper person, considering:
the gravity of the Code of Professional Conduct breaches (Code items 1, 2 and 7)
the dishonest, deliberative and repetitive nature of her conduct
the lack of remorse for her conduct which she demonstrated in her responses to our enquiries.
The BCC also noted that the agent had not taken any action to remove herself as a trustee of the SMSFs she was associated with, despite her disqualification under the SISA.
The BCC decided to terminate the agent’s registration and prohibited her from applying for registration for a period of two years.