The focus of CharterLaw’s tax controversy and tax litigation practice is our ability to robustly defend business and high net worth clients if they are in dispute with the ATO – either in court when required or by skilfully negotiating and settling with the ATO – whatever is required to achieve the best practical outcome for the client.

Our team of tax lawyers includes
the following senior lawyers
Scott Gray

Scott Gray

Tax controversy and
tax litigation lawyer
Peter McCrohon

Peter McCrohon

Tax advisory lawyer
Austin Pitman

Austin Pitman

Tax advisory lawyer

Enquire today for your consultation

Failure To Lodge

Failure To Lodge

Failure to lodge relevant ATO documents can lead to huge penalties and criminal prosecution. We can ensure you are not exposed to unnecessary payment of fines.

Tax Fraud & Evasion

Tax Fraud & Evasion

CharterLaw Legal can strategically negotiate, defend and settle most ATO claims concerning tax fraud and evasion, leaving you safe from the long arm of the law.

International Tax /Tax Havens

International Tax /Tax Havens

Tax havens & international tax structures are becoming less secretive & the ATO is more active in pursuing people who continue to evade tax from foreign sources, including tax havens.

Tax Audit & Objections

Tax Audit & Objections

You don’t have to agree with the ATO’s decisions if you are audited. We can defend you rights and guide you through the audit process so that we achieve the best result possible.

Tax Residency

Tax Residency

You shouldn’t have to pay tax in Australia if you do not meet the requirements for Australian tax residency, even if the ATO says that you do!

Failure to Lodge

The ATO expects Australian taxpayers to bear the burden of complying with up to 77 separate tax obligations each year. It is hardly surprising then, that many businesses fall behind and fail to comply.

According to the Australian Bureau of Statistics there are approximately 2.1 million active businesses in Australia. The Commissioner of Taxation, in his recent Annual Report, cites an average compliance for income tax returns of 75.6% for companies and 83% for individuals. This equates to hundreds of thousands of taxpayers who either lodge late or fail to lodge anything at all.

A failure to comply with your statutory obligations is a serious offence that regularly leads to criminal prosecution. The longer you leave it the worse it becomes. Don’t be the next person that the ATO prosecutes – we can help you avoid prosecution, reduce the amount payable and restructure your affairs to give you in the best tax profile position possible.

The penalties for failure to lodge are swift and severe. Offences pursuant to section 8C of the TAA 1953 are punishable (as at 1 July 2017) by fines of up to $4,200 for the first offence, $8,400 for the next offence and $10,500 for each subsequent offence, with a potential 12 month custodial sentence (prison). Considering that it is common to have multiple years of non-lodgement and BAS is due 4 times per year it is easy to see how the potential fines can escalate very quickly. Of course, this is in addition to any tax and interest that is owed.

You may be asked to appear before the Court in your individual capacity even if the tax offence was committed by a company or trust, leaving you with a criminal record. The deeming provisions in section 8Y of the Tax Administration Act 1953 (TAA) allow the ATO to attack the company officer responsible for the tax offence of the company or trust and bring them before the Court to be punished.

CharterLaw Legal has extensive experience in dealing with failure to lodge issues and utilises a solid network of high ranking contacts within the ATO to achieve results that can only be obtained by tax professional who understand ATO policies and procedures. Working constructively with the ATO in way that robustly protects your interests can result in potential ATO criminal prosecutions being avoided and a negotiated settlement with the ATO.

CharterLaw Legal is part of a professional services group that includes CharterLaw Accounting, and this gives us immediate access to chartered accountants who will undertake the necessary compliance work that must be prepared in order to make an appropriate disclosure to the ATO.

This allows CharterLaw Legal to control the entire process and to maintain confidentiality no third the parties are involved apart from yourself, the ATO and your CharterLaw adviser.

CharterLaw Legal offers sound technical confidential advice, which is bound by legal professional privilege, to ensure that your rights are protected and what you tell us stays with us.

Contact our team today

Tax Fraud & Evasion

“I am not evading tax in any way, shape or form. Of course, I am minimising my tax. Anybody in this country who does not minimise his tax wants his head read. I can tell you as a government that you are not spending it so well that we should be donating extra.” Kerry Packer (when addressing a Government Senate enquiry on corporate tax evasion)

Tax fraud is knowingly, recklessly or without belief in the truth, making a false statement to the ATO with the result being that the taxpayer claims a tax benefit it is not entitled to. This is fairly uncontroversial however tax evasion has a broader spectrum that may fit between an innocent mistake and some “blameworthy act or omission” (as described by Dixon J in Denver Chemical Manufacturing v Commissioner of Taxation)

When imposing shortfall tax for fraud and evasion the ATO will characterise your culpability level into the three categories of failing to take reasonable care, recklessness and intentional disregard.  The Tax Administration Act 1953 prescribes the penalties, which can be up to 75% of the tax owing. In addition, a further 20% uplift is added in certain circumstances – totalling 90%. Finally, interest at high rates are applied and backdated to the relevant time which can often result in more money being owed in penalties and interest than what is owed in tax!

A finding of Intentional disregard during a tax audit will likely trigger a further internal assessment as to whether you should be referred to the Commonwealth Director of Public Prosecutions for criminal prosecution. Put simply, Intentional disregard means that you knew that what you were doing was wrong but you ignored the law and proceeded anyway. This may be by making a false statement to the ATO or by omitting to disclose relevant information. Even in the absence of direct evidence against you a charge may be proved when the facts and circumstances support an inference that you acted with an intentional disregard for the law (see Weyers v. Federal Commissioner of Taxation [2006] FCA 818). Such findings will often lead to a custodial sentence (prison).

 

Once the decision to prosecute has been made, charges of dishonesty against the Commonwealth (Criminal Code Act 1995), including ‘dishonestly obtain a financial advantage from a Commonwealth entity’ may be brought against you and can attract a 10 year prison sentence.

You may be asked to appear before the Court in your individual capacity even if the tax offence was committed by a company or trust, leaving you with a criminal record. The deeming provisions in section 8Y of the Tax Administration Act 1953 allow the ATO to attack the company officer responsible for the tax offence of the company or trust and bring them before the Court to be punished.

There are a number of approaches available which may result in a reduction of penalties. One such approach is to seek the protection of what is called ‘safe harbour’ if you or your tax agent have failed to take reasonable care. With a carefully structured approach, the ATO may acknowledge mitigating factors, including honest mistake, which will reduce the penalties imposed and remove the threat of criminal prosecution. This is not easily accepted by the ATO without detailed scrutiny of the facts and circumstances. However, with the right strategy and comprehensive knowledge of the ATO’s policy and procedure a negotiated settlement may be agreed upon that minimises the damage that the ATO is seeking to inflict.

CharterLaw Legal has extensive experience in dealing with tax fraud, evasion and avoidance by utilising a solid network of high ranking contacts within the ATO to achieve results that can only be obtained by tax professional who understand ATO policies and procedures. Working constructively with the ATO in way that robustly protects your interests can result in potential ATO criminal prosecutions being avoided and to a negotiated settlement with the ATO.  Our objective is you pay what is fair but as little as possible.

CharterLaw Legal is part of a professional services group that includes CharterLaw Accounting, and this gives us immediate access to chartered accountants who will undertake the necessary compliance work that must be prepared in order to make an appropriate disclosure to the ATO.

 

This allows CharterLaw Legal to control the entire process and to maintain confidentiality no third parties are involved apart from yourself, the ATO and your CharterLaw adviser. CharterLaw Legal offers sound technical confidential advice, which is bound by legal professional privilege, to ensure that your rights are protected and what you tell us stays with us.

Contact our team today

International Tax / Tax Havens

Tax havens and offshore finance centres are often spoken about as being in the same category, although this is not necessarily always the case. There are significant similarities with key features being that they may be used to avoid tax laws of other countries. People can be drawn to these kinds of structures because of elements such as strong bank secrecy, concealment of legal entities or the beneficial owners.

 

The Organisation for Economic Corporation and Development (OECD) further defines a tax haven as having:

  1. no, or only nominal, taxes, therefore, lending itself to be considered a place to be used by nonresidents to avoid tax in their home country
  2. adopted legislation which specifically prevents the exchange of information
  3. a lack of transparency in its dealings with nonresidents

 

A further trait shared by tax havens is no formal requirement that investment activities be substantial, with the argument being that this would attract such investments which are exclusively tax driven.

 

However, these structures are not illegal if they are transparent and reported to the ATO with tax paid on any income earned. There may be a good reason to implement an offshore tax structure which includes the use of a tax haven which does not include tax evasion. The problem is that, for various reasons, the ATO will view the use of such structures with suspicion. Notwithstanding the high risk of unwanted attention, such structures can be used legally and efficiently for people who trade in the international market.

Some people unwittingly find themselves in a position where they may not be tax compliant. This could be for of reasons including inheriting a beneficial ownership in an offshore structure that was previously unknown to them or, as commonly occurs, receiving poor advice and acting upon it without a complete understanding of the consequences.

In many cases, it is possible to make a voluntary disclosure to the ATO in a genuine effort to come forward and correct earlier mistakes. Whilst you are exposing yourself completely to the ATO a methodical approach will initiate a platform to promote negotiation and settlement. Although the ATO have promoted so-called tax amnesties in the past, such as Project DOIT, there is always an opportunity to obtain similar generous discounts and concessions with a strategic and planned approach.

If you are found to have deliberately avoided your tax obligations and you do not effectively engage the ATO in meaningful negotiations, you may be referred to the Commonwealth Director of Public Prosecutions for criminal prosecution. Even in the absence of direct evidence against you a charge may be proved when the facts and circumstances support an inference that you acted with an intentional disregard for the law. Such findings can lead to a custodial sentence (prison) being imposed by the court.

You may be asked to appear before the Court in your individual capacity even if the tax offence was committed by a company or trust, leaving you with a criminal record. The deeming provisions in the Tax Administration Act 1953 allow the ATO to attack the individual responsible for the tax offence of the company or trust and bring them before the Court to be punished.

CharterLaw Legal has extensive experience in dealing with tax fraud, evasion and avoidance by utilising a solid network of high ranking contacts within the ATO to achieve results that can only be obtained by tax professional who understand ATO policies and procedures. Working constructively with the ATO in way that robustly protects your interests can result in potential ATO criminal prosecutions being avoided and to a negotiated settlement with the ATO.  Our objective is that you pay what is fair but as little as possible.

CharterLaw Legal is part of a professional services group that includes CharterLaw Accounting, and this gives us immediate access to chartered accountants who will undertake the necessary compliance work that must be prepared in order to make an appropriate disclosure to the ATO.

This allows CharterLaw Legal to control the entire process and to maintain confidentiality no third parties are involved apart from yourself, the ATO and your CharterLaw adviser. We offer sound technical confidential advice, which is bound by legal professional privilege, to ensure that your rights are protected and what you tell us stays with us.

Contact our team today

Tax Audit & Objections

In the eyes of the ATO, a tax audit is a necessary tool to encourage taxpayers to do the right thing but the reality is that they are a painful scrutiny of your affairs and can take up to 18 months to complete. In a world where it is impossible to be perfect, the ATO can find problems with even the most fastidious accounts. Industries, where cash payments occur, are at a high risk of being audited.

 

Although the ATO have recently claimed to have adopted a warmer approach to working with taxpayers it should not be mistaken for thinking that the ATO will not exploit each mistake they find. Ultimately, they will seek to justify a result for the time, effort and resources committed to an audit to ensure there is full compliance. It should be remembered that the taxpayer carries the burden of proof.

 

Voluntarily disclosing information during an audit can be a sensible way of reducing the time, effort and resources that the ATO expends during an audit but there is a danger of inadvertently admitting to problems that you did not know existed. Obtaining guidance and assistance from a tax lawyer can fend off the ATO so that you can get back to business.

Over declaring deductions or under-declaring income can lead to heavy penalties, and in some cases criminal prosecution. The ATO are well versed in detecting problems at all levels of business and rarely if ever, are fooled by businesses standard attempts to conceal their wrongdoing. Common indicators for the ATO are things such as the financial performance of the business compared to similar businesses in that area (called the benchmark range), compliance with superannuation and PAYG obligations, variances between tax returns and BAS, and constant losses or other anomalies which often point to problems.

The Tax Administration Act 1953 prescribes the penalties for tax audits, which can be up to 75% of the tax owing. In addition, a further 20% uplift is added in certain circumstances – totalling 90%. Finally, interest at high rates are applied (and backdated) meaning it can easily result in more money being owed in penalties and interest than what is owed in tax! In serious cases, taxpayers can be referred for criminal prosecution.

Early intervention by an experienced tax lawyer is always going to place you in the best possible position. However, if you already been audited and disagree with the ATOs decision we can prepare and lodge an objection to ensure you do not pay anything more than you are required to. We can also strategically negotiate a reduction of penalties and interest.

A finding of Intentional disregard during a tax audit will likely trigger a further assessment as to whether you should be referred to the Commonwealth Director of Public Prosecutions for criminal prosecution. Put simply, Intentional disregard means that you knew that what you were doing was wrong but you ignored the law and proceeded anyway. This may be by making a false statement to the ATO or by omitting to disclose relevant information. Even in the absence of direct evidence against you a charge may be proved when the facts and circumstances support an inference that you acted with an intentional disregard for the law. Such findings will often lead to a custodial sentence (prison) being imposed by the court.

You may be asked to appear before the Court in your individual capacity even if the tax offence was committed by a company or trust, leaving you with a criminal record. The deeming provisions in section 8Y of the Tax Administration Act 1953 allow the ATO to attack the individual responsible for the tax offence of the company or trust and bring them before the Court to be punished.

CharterLaw Legal has extensive experience in dealing with tax audits and utilises a solid network of high ranking contacts within the ATO to achieve results that can only be obtained by tax professional who understand ATO policies and procedures. Working constructively with the ATO in way that robustly protects your interests can result in potential ATO criminal prosecutions being avoided and a negotiated settlement with the ATO.

 

CharterLaw Legal is part of a professional services group that includes CharterLaw Accounting, and this gives us immediate access to chartered accountants who will undertake the necessary compliance work that must be prepared in order to make an appropriate disclosure to the ATO.

This allows CharterLaw Legal to control the entire process and to maintain confidentiality no third parties are involved apart from yourself, the ATO and your CharterLaw adviser.

 

CharterLaw Legal offers sound technical confidential advice, which is bound by legal professional privilege, to ensure that your rights are protected and what you tell us stays with us.

Contact our team today

Tax Residency

Having Australian tax residency means you pay tax in Australia on your worldwide income, this can occur even if you leave Australia. Likewise, if you enter Australia temporarily from another country you may be asked to pay tax in Australia on your worldwide income if you are characterised as an Australian tax resident.

 You shouldn’t have to pay tax in Australia if you do not meet the requirements for Australian tax residency, even if the ATO says that you do! The requirements are non-exhaustive and can often turn on the facts and circumstances of each case. It is important that you get the right advice and don’t fall for the ATO’s ‘broad brush’ approach.  You may even inadvertently trigger a capital gains tax event when you leave Australia. This can leave you with a tax debt even if you have not disposed of the CGT asset.

It is common for Australians in various industries to pursue working overseas with the promise of big returns and little tax to pay. Unfortunately, without proper guidance and advice, the ATO may decide that person maintained Australian tax residency whilst overseas, meaning they are taxed as if they never left Australia.

 

If you work abroad for a period of time (pursuant to a fixed contract) the ATO will assess your tax residency status on your return to Australia which may result in very large tax debts. Similarly, if you enter Australia (regardless of whether you engage in income earning activities) you may be asked to pay tax on your overseas income. The ATO applies very broad and non-exhaustive tests when determining tax residency status so only a carefully constructed strategy by an experienced tax lawyer will prevent you paying tax unnecessarily.

If you have had money transferred to you from overseas the ATO may ask you to pay tax on it, even if it is a gift. Usually, the Australian Transaction Reports and Analysis Centre (AUSTRAC) detects the transfer and notifies the ATO. The ATO then send you a letter advising that it will amend your assessment to include the transfer as taxable foreign sourced income unless you can, within 28 days, provide a good and sufficient reason why that should not occur.

The taxpayer bears the burden of proof. Whilst the tax is avoidable if the receipt of money was a genuine gift the ATO will not accept that it was a gift without sufficient evidence to prove it. A lack of information and substantiation will simply result in the ATO sending you a tax bill.

CharterLaw Legal has extensive experience in dealing with tax residency issues and utilise a solid network of high ranking contacts within the ATO to achieve results that can only be obtained by tax professionals who understand ATO policies and procedures.  Working constructively with the ATO in a way that robustly protects your interests can result in potential ATO criminal prosecutions being avoided and to a negotiated settlement with the ATO.

CharterLaw Legal is part of a professional services group that includes CharterLaw Accounting, and this gives us immediate access to chartered accountants who will undertake the necessary compliance work that must be prepared in order to make an appropriate disclosure to the ATO.

This allows CharterLaw Legal to control the entire process and to maintain confidentiality no third parties are involved apart from yourself, the ATO and your CharterLaw adviser. CharterLaw Legal offers sound technical confidential advice, which is bound by legal

professional privilege, to ensure that your rights are protected and what you tell us stays with us.

If you have been found to have deliberately avoided your tax obligations and you do not effectively engage the ATO in meaningful negotiations, you may be referred to the Commonwealth Director of Public Prosecutions for criminal prosecution. Even in the absence of direct evidence against you a charge may be proved when the facts and circumstances support an inference that you acted with an intentional disregard for the law. Such findings can lead to a custodial sentence (prison) being imposed by the court. It is our aim to avoid this by protecting your rights.

Contact our team today

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