Fake tax agent fined $40k

The Federal Court of Australia has fined Arlene Caolboy $40,000 for unlawfully providing tax agent services to approximately 350 taxpayers over the past four years, advertising online and claiming she was a registered tax agent.

The court imposed an injunction on Caolboy preventing her from providing tax agent services or business activities statement (BAS) services for the three years whilst she remained unregistered with the Tax Practitioners Board (TPB).

Justice Michael Wheelahan said Caolboy’s actions were at the “serious end of the spectrum”, and recognised that her clients were put at risk by having their tax affairs managed by a person without the requisite qualifications.

However, if it was for her cooperation with the TPB, a much higher penalty would have been appropriate.

She had admitted to the TPB all the contraventions and later voluntarily disclosed to the TPB and Australian Tax Office (ATO) all client records, outlining the tax agent services she had provided, including cash income she had received for them.

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Ian Klug, TPB chair, said they were pleased the court appreciated the magnitude and seriousness of the contraventions, and that Caolboy undermined the tax profession by misrepresenting herself.

“We believe the Court has reached an appropriate punishment for Caolboy’s misconduct; it is a clear message to any others providing tax agent services unlawfully that the TPB will take firm action,” Klug said.

“However, we do take into account personal circumstances and, as demonstrated here, may recommend leniency where someone co-operates fully with us.”

“We would encourage consumers to exercise care when choosing a tax practitioner. We remind everyone that a registered tax agent would not look to lodge your return through your myGov account.”