The law imposes penalties on trustees of funds for:
- failing to lodge the tax return on time and in the approved form
- having a shortfall amount for underreporting a liability or over-claiming a credit that is caused by taking a position that is not reasonably arguable
- making a false or misleading statement in a material particular
- failing to provide a tax return from which the Commissioner of Taxation can determine a liability
- obtaining a scheme benefit
- failing to keep and produce proper records
- preventing access to premises and documents
- failing to retain or produce declarations.
The penalty for a false or misleading statement can apply to statements which result in shortfall amounts but it also applies to statements which do not result in an increased liability. Penalties will not apply even if the trustee (and their agent if applicable) made a mistake where they took reasonable care in connection with making the statement.
The trustee of a fund is liable for the GIC where:
- tax, penalties or shortfall interest charges remain unpaid after the due date for payment
- a variation of a pay as you go (PAYG) instalment rate or amount is less than 85% of the rate or amount that would have covered the fund's actual liability for the year.
The trustee of a fund is liable for the shortfall interest charge (SIC) where the fund's income tax assessment is amended to increase their liability. Generally, the SIC accrues on the extra tax payable from the due date of the original assessment until the day before the assessment is amended.
Knowingly answering a question incorrectly will be treated as a more serious offence than answering carelessly.