Court overturns ART tax agent decision

The Federal Court has ruled the Administrative Review Tribunal (ART) was in error when it found a tax agent who failed to disclose his SMSF’s outstanding tax lodgement obligations was a fit and proper person and has sent the case back to the tribunal.

The court made the ruling in the case of Tax Practitioners Board v Free [2026] FCA 1155, heard before Justice Kylie Downes on 13 August, after the ART set aside a decision by the Tax Practitioners Board (TPB) to terminate the registration of tax agent Owen Stanley Free for not disclosing matters that may affect his integrity, character and eligibility for registration.

These matters were that Free had not disclosed his SMSF’s outstanding tax lodgement obligations and there was an adverse finding against him made by another court in relation to a prior unfair dismissal matter.

The decision was made by the ART on 10 February to set aside Free’s termination, which took place under the ‘fit and proper person’ definition in the Tax Agent Services (TAS) Act 2009, and instead issue him with a written caution and require him to undertake and complete certain remedial education.

This decision was appealed by the TPB, which questioned if the ART erred in law by failing to properly apply the correct legal test as to whether Free was a fit and proper person within the meaning of the TAS Act, and whether it also erred in determining evidence about his tax obligations should not apply in the TPB’s considerations.

The matter was heard across five different grounds brought by the TPB and in each case the Federal Court found in its favour.

The ruling of the case stated “the board has established that the tribunal’s decision was affected by legal error”.

“Accordingly, the appeal will be allowed, the tribunal’s decision will be set aside, the proceeding will be remitted to the tribunal (differently constituted) to be determined according to law, and costs will follow the event,” it said.