The annual return of the company owned by the family of the Leader of the Opposition, John Hewson, has not been filed on its due date, according to the publicly available record.
A search of the Australian Securities Commission record yesterday revealed that the annual return of Brintmar Holdings Pty Ltd, the Hewson family company, was due to be filed on January 31, but had not been filed by yesterday, according to the public record. This is a minor breach of the Corporations Law.
To be in time, the company should have filed the return on Friday. It is possible that the return has been filed, but not yet put on the public register.
A call to Dr Hewson’s office early yesterday afternoon and a follow up later in the afternoon asking that his press secretary call back yesterday concerning Dr Hewson’s company’s annual return was not returned.
Failure to file the return on time will result in the company having to pay a late lodgement fee of $20, or if a penalty notice has been issued by the ASC, a further $125. If it is not filed within a month of being due the company is liable to a $181 late lodgment fee as well as any penalty under an ASC notice.
Since substantial computerisation at the ASC, penalty notices are issued automatically by computer to companies that have significantly late returns.
Each year in Australia, hundreds of companies file late returns and incur late lodgement fees and late penalties. They rate about the same as a parking infringement. However, in the circumstances it seems a little politically inept for Dr Hewson not to have ensured that the return was not lodged in time for the public record to show all was in order.
The Opposition has condemned the Prime Minister, Paul Keating, for not loding his tax return on time and for being the half owner of a company that has not obeyed ASC requirements on lodgement of returns and accounting requirements in them.
Dr Hewson, as a director of Brintmar, has personally signed previous returns of the company. Last year the company also filed its return a few days late and Dr Hewson came in for some flak in Parliament because of it. One would have thought he would have avoided a repeat performance by simply making an appropriate diary entry to ensure the return was lodged weeks early so there could be no danger of delays by the company’s accountants or the ASC filing system causing his company to be, or to look as if it were, late in filing.
Perhaps he can offer the Keating excuse: he was two busy with nose down and bum in the air working on the nation’s economic difficulties, so his own affairs got over-looked. It is not as if he or the company’s accountants are unaware of ASC filing requirements. Early last year the company filed a notice of change of address in accordance with ASC requirements.
Like most family companies, Brintmar runs its accounts according to the financial year. Under s 335 of the Coprorations Law the company must present its accounts to an annual general meeting within six months (that means December 31) and must file its return within a month of that (that means January 31).
Brintmar, which is described as an investment company, had a profit of $60,923 for the 1990-91 financial year, according to the 1991 annual return. The structure of the company enables that profit to be distributed among Dr Hewson, Caolyn Hewson and Dr Hewson’s three children in whatever portions Dr and Mrs Hewson (as directors) determine. The company has five classes of shares A to E and one share of each class. Each person therefore has one share of a different class, enabling distribution in different proportions.
In the early and mid-1980s such a company structure could be used to distribute income among family members to lower the familiy’s overall tax liability.
Ironically, Mr Keating, when Treasurer, eliminated any tax benefits in having that sort of structure. Under Mr Keating’s dividend imputation scheme, once the company pays tax on its profits, dividends paid to any shareholder are effectively tax free, no matter how high the shareholder’s income.
In a recent biography of Dr Hewson by journalist Christine Wallace, it was asserted that Dr Hewson used Brintmar and negative gearing to reduce his tax to an effective rate of 15 per cent from the then prevailing marginal rate of 60 per cent.
The 1991 annual return shows that Brintmar has assets of $1,328,508 and liabilities of $1,031,349 giving an overall shareholders’ equity of about $300,000.
Dr Hewson’s other family company, Tobazo Pty Ltd, did not do so well last year. Tobazo is owned equally by Dr and Mrs Hewson. It posted a $4000 loss in 1991, but has overall assets of $40,000.
Its annual return is not due until later in the year.