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  • Penalties

    Refer to section 4AA of the Crimes Act 1914 for the current value of a penalty unit.

    Individuals

    A person will be liable for an administrative penalty of 20 penalty units where either:

    • they fail to give a CRA to ensure the release of the full amount of ENCC tax to a super fund within 21 days after the date of the CRA under section 288-90 of Schedule 1 to the TAA
    • the combined amount paid by their super funds exceeds the amount authorised to be released under section 288-100 of Schedule 1 to the TAA.

    Example 4.3

    Sharon receives a CRA in relation to her ENCC tax and presents it to multiple funds and, in doing so, accesses more than the total authorised for release.

    Sharon will be liable for an administrative penalty. In addition, the amount over what should have been released (that is, her ENCC tax liability) will be included in her assessable income in the year it was released and subject to income tax at marginal rates.

    End of example

    Super fund

    Under section 288-95 of Schedule 1 to the TAA, a super fund will be liable for an administrative penalty of 20 penalty units where they fail to comply with a release authority within the required time.

    Section 286-75 of Schedule 1 to the TAA imposes an administrative penalty on a super fund that fails to comply with the release authority reporting requirements (to the member and us).

    The amount of the penalty is worked out in line with section 286-80 of Schedule 1 to the TAA.

    Remission of administrative penalties

    Administrative penalties apply where a person or super fund does not comply with their obligations in relation to a release authority. Section 298-20 of Schedule 1 to the TAA, however, gives us the discretion to remit all or part of each of the administrative penalties imposed.

    In determining whether it is appropriate to exercise the discretion, we will:

    • consider information provided by the person or super fund
    • consider evidence of the person’s or super funds attempt to comply with their obligations in relation to a release authority
    • consider facts which are relevant to the appropriateness of the penalty in the circumstances
    • act consistent with the principles of the compliance model and Taxpayers’ Charter
    • apply the good-decision making model.

    If the person or super fund has made a genuine attempt to comply with their obligations, the penalty may be remitted in full. However, if they have made little or no attempt to meet their obligations, the penalty may not be remitted at all.

    It will be considered that a genuine attempt to comply was made if the person or super fund took action to understand their obligations and, once they became aware of the obligations, immediately took corrective action.

    No attempt to comply will occur where the person or super fund became aware of their obligations but failed to take action, or deliberately delayed complying with their obligations.

      Last modified: 28 Mar 2018QC 50732