Unregistered ‘tax agents’ cop $900k fines
A Canberra-based "tax agent" and his company have been issued with a record penalty for a series of breaches of the Tax Agent Services Act 2009 (TASA).
The Federal Court of Australia ordered that Peter Kolya pay a $150,000 penalty and his company, HP Kolya, pay a $750,000 penalty, plus costs as a result of the breaches.
Court documents revealed that Kolya had throughout the period 2001—2010, Kolya operated his business by claiming that H&R Block was his supervising agent and that he was entitled to use tax agent No. 66837074 which was one of H&R Block's tax agent numbers.
However, the court found Kolya was not entitled to use that tax agent number and his claim to have been operating under the auspices of H&R Block was completely false.
In 2008, H&R Block became aware of Kolya's activities. As a result, through its solicitors, it immediately took steps to require Kolya to cease representing that he had an appropriate connection with H&R Block.
The Tax Practitioners Board presented evidence that Koyla:
- "Knew that the pleaded conduct was in breach of the TAS Act;
- Knew that he was engaging in conduct which he had been prohibited from undertaking by various decisions of courts and tribunals;
- Was well aware of the likely harm his continued conduct of his business was likely to cause; and
- Has never shown any contrition whatsoever for the pleaded conduct and appears to have no appreciation of its seriousness."
The court found that Koyla's conduct "displayed a flagrant disregard for the relevant registration requirements under the TASA".
Alongside fines of $900,000, the court has imposed a 10-year injunction against Koyla and his company, prohibiting them from providing or advertising tax agent services of BAS services.
AUTHOR
Nicholas O'Donoghue
Recommended for you
Financial Services Minister Stephen Jones has shared further details on the second tranche of the Delivering Better Financial Outcomes reforms including modernising best interests duty and reforming Statements of Advice.
The Federal Court has found a company director guilty of operating unregistered managed investment schemes and carrying on a financial services business without holding an AFSL.
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
