Can you rely on a letter from the ATO?

The recent decision of Pintarich v Deputy Commissioner of Taxation [2018] FCAFC 79 highlights the possible risk of taking correspondence from the Australian Taxation Office at face value.

The Key Facts

1. The taxpayer did not file timely tax returns for the 2010 to 2013 income years.
2. The taxpayer was issued notices of assessment in respect of those years. The taxpayer owed over $1.15 million, comprised of approximately $821,000 in primary tax and $335,000 of general interest charge (GIC).
3. The taxpayer's accountant wrote to the ATO seeking a remission of the GIC under section 8AAG of the Taxation Administration Act 1953 (Cth).
4. The taxpayer, his accountant and an authorised officer of the ATO (Officer) corresponded with each other in relation to the tax liabilities.