‘Fraud' or ‘evasion’: dealing with the aftershocks

Matthew Crowley ATI
When the Commissioner lawfully forms an opinion that ‘fraud' or ‘evasion’ has occurred, the aftershocks can reverberate in Part IVC, debt recovery and criminal process, triggering cascading penalties and inflicting severe reputational damage for many years.

There are, however, specific instances in which the Commissioner’s powers can be challenged. There are also steps an adviser should take when advising a client and seeking to protect them.

Further, when considering tax litigation, advisers need to be aware of the impacts of recent tectonic shifts in administrative law.

Matthew Crowley ATI, (Barrister, Francis Burt Chambers) presents the upcoming masterclass, ‘Fraud or evasion: making tax assessments great again, in Perth in September 2017.

Here he outlines some of the complexities in this space and highlights some of the blind spots for advisers. 

Matthew told us: “For the last 25 years or so, administrative/public law has been the subtlest and most dynamic area of the law, to my mind. Sitting at the centre of the Venn diagram between the relentless expansion of the administrative state, a more muscular projection of control by Parliament, and an executive trying to regulate new technologies and services not anticipated by Parliament, and the courts reacting to overreach, public law delineates the fault lines. Tax law is more understandable and predictable when understood in its true context”.

In his session, Matthew will discuss the impact on tax litigation that changes in administrative law present. Providing a comprehensive summary of all the relevant instruments, cases and practice statements, he will also consolidate the latest case law on ‘conscious maladministration’ and administrative challenges under s39B of the Judiciary Act.

“Participants in this masterclass can expect to walk away with a general and specific understanding of when the Commissioner’s power to issue assessments at any time for ‘fraud or evasion’ is enlivened.”

“During the session, we will examine the substantive law on ‘fraud or evasion’ in Australia and the United States. We will work through the various options for challenging the finding, whether by judicial review for jurisdictional error under s39B of the Judiciary Act, or on Part IVC AAT review to the AAT or Federal Court appeal. We will also examine the current law on the content of jurisdictional error, and whether the very significant developments the migration arena and the High Court have impacted upon Futuris. We will also examine how a taxpayer might otherwise go about challenging an amended or default assessment as ‘excessive’”.

Since returning in 2016 from a stint with the Federal Trade Commission in Washington DC and as visiting Fulbright scholar at Columbia University in New York, Matthew has set about establishing a tax practice at the Western Australian bar. 

Asked about his experience, he said “They say that the law sharpens the mind by narrowing it, but I came to tax law in a comparatively unorthodox way. Having completed my BA in English and History, I dropped out of law school to travel the world for most of my twenties, with $500 in my sock (my net worth at the time) and a one-way ticket to Hong Kong. Returning later to the fold, I think it has made me a much more effective lawyer, a better communicator, a tougher advocate and a wiser adviser. Also, I come to tax practice as applied administrative law with a more diverse repertoire, rather than other way around.”

Asked about the blind spots facing advisers, Matthew said: “As a relative newcomer to tax law, what surprises me is how much time and money is wasted on spurious or misconceived challenges to decisions in the tax context. Some that fail appear to do so because they omit winnable grounds from an otherwise unwinnable application, while others are just misconceived. The assumptions and values that animate the private, commercial sphere, are often not those that inform the public law. 

"In this area of law, it seems to me that the bases for judicial review challenges are sometimes not well understood, and resources might be better allocated to foreclosing on findings of ‘fraud or evasion’ by proper record-keeping, by better communication with the ATO, and with a firmer grasp of the procedural and substantive law going to the objection and review/appeal process and demonstrating ‘excessiveness.’”


The ‘Fraud or evasion: making tax assessments great againmasterclass will take place on 5 September 2017 at The Tax Institute, Perth.

You can find out more about the session on our website.

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