Part 1: NCAT turned a blind eye towards the landlord’s tax compliance issue in rental payments.
A customer once told me that there are two things certain in life Death and Taxes. However, if you are a landlord in NSW you don’t need to worry about GST on rental payments as long as you are paying land tax to state Govt. In return, state Govt will turn a blind eye towards any federal tax breach and ignore the exploitation of retail lease tenant in the hands of non-complying landlords. The New South Wales Civil and Administrative Tribunal unlawfully turns a blind eye towards any breaches of GST act in retail lease rent payments, and encourage the behavior that leads to increasing cash economy, tax avoidance and tax fraud in retail lease rent payments in the economy.
Since 2007, I am running a restaurant in Kingswood which I leased from Fobupu Pty Ltd (Dr. Ghulam Akbar Khan). A restaurant is a tough and competitive business, you need to burn lots of hours to ensure your customer comes back and order again. I was new to the small business world in 2007 completely unaware of the complexities of the retail lease act. Dr. GA Khan has also been councillor of Penrith City council for some years. I was very excited to have this place since it was fully furnished. I paid for the fit out partly upfront and in instalments, alongside rent payments. I have been paying rent and managed to have a decent commercial relationship and look to avoid a path of dispute on more than one occasion. Ghulam Akbar Khan prefers payment to be made as cash and resisted whenever I attempted to pay him by cheque or bank transfer for over 11 years. I paid over a million dollar in payments to a landlord and never received any receipt or tax invoice. In hindsight, it’s a bad decision to pay someone cash without any receipt or tax invoice. “It’s so difficult, isn’t it? To see what’s going on when you’re in the absolute middle of something? It’s only with hindsight we can see things for what they are.”
My restaurant required renovation, where I invested $150000+ to renovate the restaurant over a period of 2 years from 2015-2017. The renovation completed at the end of 2017. However, its my bad luck that I required invoices and receipts for my tax purposes, or else I could be exposed to a huge tax penalty. I had no option but to ask Ghulam Akbar Khan to provide the tax invoice and receipts. In the phone conversation, Ghulam Akbar Khan admitted that he has not declared rental income to his accountant or tax office. Finally, after the demand of invoices, a relationship of 11 years nosedived suddenly, Ghulam Akbar Khan sent a notice for me to sign a new lease with high rent. I never dare to ask rent invoices or receipts prior to 2017 because I knew the consequence of this will be eviction and that’s exactly what I was facing.
We approached New South Wales Civil and Administrative tribunal for relief and protection. I filed an application on 15 December 2017 in NCAT Penrith registry to seek protection against forfeiture. Interim orders were made on 17 Dec 2017 to grant a relief and restrain landlord from forfeiting a lease or taking possession. Tribunal also sets the direction hearing date on 23 Jan 2018. It was a good start towards the worst journey of my life which involves a dysfunctional tribunal who turns a complete blind eye towards the issue of tax compliance in rental payment. The Tribunal knows that there are no tax invoices provided for over 11 years, and the company, Fobupu Pty Ltd has no ABN. It’s a serious tax compliance issues which required to be dealt with by the tribunal.
Part 2 : 6 March 2018 when tribunal forced me to pay rent without invoice in breach of tax law (Coming Soon)
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