ACAT dismissed the man’s claims that he shouldn’t have to pay back a stamp duty concession, as well as penalty tax and interest. Photo: File.
A man’s on the hook to pay back $28,535 in stamp duty – plus years of penalty tax at 25 per cent – after the ACT Civil and Administrative Tribunal (ACAT) found he’d lied about his income to access the Home Buyer Concession Scheme.
Carl Michael Jackson settled on a $875,000 home on 19 January 2022. He’d received his taxable income assessment three months before from the Australian Taxation Office.
He was notified by the ACT Revenue Office through a First Reassessment Notice on 24 February 2022 that stamp duty on the home was assessed at $29,575 and needed to be paid.
Mr Jackson instead applied for the Home Buyer Concession Scheme (HBCS), which was granted.
The scheme allows for zero stamp duty to be paid on residential properties valued under $1 million, but only for eligible applicants.
Criteria include that the total gross income of all eligible home buyers, and their domestic partners (if any), in the previous year, must be under certain income thresholds.
“In the applicant’s case, the relevant income threshold was $163,330,” ACAT Senior Member Emma Morrison wrote in her decision.
“The highest income threshold under the scheme was $176,650.”
More than a year after the concession had been granted, ACT Revenue contacted Mr Jackson asking for documents as it was investigating his original application.
(HBCS applications can be reviewed at any time in the five years after an initial assessment is made.)
ACT Revenue attempted to contact Mr Jackson multiple times but was unsuccessful. It issued a notice on 29 January 2024 that the concession had been removed and he needed to pay $50,311.41 (which included the original stamp duty, penalty tax of 50 per cent and interest).
It needed to be paid by 19 February.
Three days after the payment due date, Mr Jackson submitted an objection. He was notified that interest would continue to accrue while ACT Revenue assessed his claim.
On 23 December 2024, the stamp duty amount was revised to $28,535, and the penalty tax rate was reduced to 25 per cent. Mr Jackson was still expected to pay.
He instead took the matter to the tribunal.
Senior Member Morrison said that, during the ACAT proceedings, Mr Jackson didn’t dispute the amount of stamp duty owed nor that his gross (and taxable) income exceeded the eligibility threshold “by a significant sum”.
“In essence, the applicant seem to argue the First Reassessment Notice created a ‘legitimate expectation’ which entitled him to form a view that he would never have to pay [stamp duty] on his property purchase, even though he did not meet the HBCS eligibility criteria at the time the concession was granted,” she wrote.
“The applicant’s gross income in the 2020-21 financial year exceeded even the maximum income threshold for the HBCS.”
Mr Jackson argued he’d intended to make additional, retrospective superannuation contributions to reduce his income so it would fall under the relevant threshold.
He also said he subsequently shouldn’t be liable for the penalty tax or interest, and a death in the family (following an illness) meant he’d been unable to deal with the “complexity” of responding to ACT Revenue when the office tried to contact him.
However, Senior Member Morrison noted Mr Jackson had signed an agreement on his original HBCS application stating he understood he’d self-assessed his eligibility, that he had to keep records for five years so that his tax liability could be “properly assessed”, and that he had to notify ACT Revenue within 30 days if he became aware of anything that would impact his eligibility.
“The applicant’s argument indicated he knew he was ineligible for the scheme at the time he applied but decided to claim the concession anyway,” she wrote.
“He has steadfastly refused to pay his tax debt … those decisions are entirely in his control.
“In this case, the facts do not support any finding that the applicant took reasonable care to comply with the tax law or that his tax default was entirely outside his control.”
Mr Jackson also attempted to obtain an emergency ‘cease and desist’ order to prevent ACT Revenue from taking further action to recover his tax debt until the ACAT proceedings had been finalised.
He also sought an order to have $25,000 in damages awarded to himself for “adverse actions” taken by ACT Revenue.
“No particulars of loss or damage were provided,” Senior Member Morrison noted.
“I could not be satisfied of any disadvantage or harm to the applicant beyond the natural consequence of him incurring a significant tax debt and his continued refusal to pay.”
Both of these applications were dismissed.
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