Problem
Alan Stewart engages Tony Chung of the accounting and tax agent firm of Chung and Partners to handle his accounting and tax affairs. During the 2019/20 tax year, Tony was less than diligent in attending to Alan's affairs. Although by 1 August 2019 Alan had provided Tony with all the necessary information to enable his 2018/19 return to be prepared, Tony did not complete and lodge the return until 9 June 2020, and $25,000 in consulting income earned by Alan was omitted from the return. Alan received a fine for the late lodgement of his return. A subsequent tax audit revealed the omission of the $25,000 in consulting fees and the ATO imposed a penalty of 25% of the tax shortfall plus interest.
Also in 2019/20, encouraged by Tony, Alan entered a tax minimisation scheme. The ATO disallowed the $40,000 in deductions claimed by Alan in respect of this tax arrangement.
Task
Alan is naturally concerned about these events and seeks your advice as to what remedies, if any, he may seek. Outline what action Alan may take in respect of each of the matters referred to above.