Member for Paterson Meryl Swanson has rejected a "false" newspaper report that her co-ownership of a company owing a tax debt may rule her ineligible for the federal election.
The Labor MP lists a tax office debt linked to her co-ownership of Swanridge Investments Pty Ltd, a company which sells horse rugs, on the parliamentary pecuniary interest register.
The register names Ms Swanson and her husband, Nick, as directors of Swanridge. It nominates a "tax debt (via Swanridge Investments P/L)" to her spouse and a separate, unspecified "tax debt" to Ms Swanson.
A report in The Australian suggested Ms Swanson "may never have been eligible to enter parliament and could be ineligible to contest the May 18 election under section 44 of the Constitution".
Section 44(v) of the Constitution says anyone who has "any direct or indirect pecuniary interest in any agreement with the Public Service of the Commonwealth otherwise than as a member and in common with the other members of an incorporated company consisting of more than twenty-five persons shall be incapable of being chosen or of sitting as a senator or a member of the House of Representatives".
Ms Swanson told the Newcastle Herald on Tuesday that she had received advice that the tax arrangement was not a breach of section 44.
"I'm completely open about this," she said.
I don't know if it's a dirt unit from the Liberal party or just a very keen journalist.
"In 2015-16 - as any small business owner will tell you, you have good years and bad years - we had to have an arrangement with the tax office, which we got all completely normal, and I declared that as a pecuniary interest when I ran [in the 2016 election].
"I don't know if it's a dirt unit from the Liberal party or just a very keen journalist from The Australian has gone back and brought that up.
"She [the journalist] has said that it might be a section 44 issue. I have received advice to say that it isn't.
"I am completely up to date with my tax. We're fulfilling our obligations fully. It is just not accurate to say that I'm not."
Ms Swanson confirmed Swanridge's arrangement to repay the tax office was still in place.
"Yes, we have an arrangement. In fact, I'm not even part of that company, but that's OK. I'm not party to the repayment agreement between the company and the tax office, but there is one."
Company records show Meryl and Nick Swanson are Swanridge's only shareholders.
Ms Swanson later clarified that she had meant to say she was "not party to the repayment agreement between the company and the tax office", not that she had no part in the company.
She said Swanridge was a company incorporated under the Corporations Act 2001 with "separate legal personality" and she was not personally liable for its tax debt.
Asked why the repayment arrangement was not a "direct or indirect" pecuniary interest, Ms Swanson said: "All I can tell you is that the advice that I have received is that it isn't, and it's the same as anyone who's got a small business who's got an arrangement with the tax office."
She denied assigning Swanridge's tax debt to her husband to avoid a pecuniary interest.
"That's not it at all, and that's why I declared it as a pecuniary interest back in 2016 ... In all honesty, I have not done that. It's just not accurate," she said.
A University of Sydney constitutional law expert, Professor Anne Twomey, told the Herald that she could not comment about the specifics of Ms Swanson's case as the facts remained unclear, but pecuniary interests could relate to agreements with the public service involving either benefits or "detrimental" repayments.
"All these things really need to be left until after the election," Professor Twomey said.
"If anyone wants to challenge it and go to court, good luck to them. And, if they don't, then it's all been declared and they should leave it be."
The Australian Electoral Commission does not have legal authority to check the eligibility of candidates.
Disqualification of candidates due to the operation of section 44 of the Constitution can only be determined by the High Court after an election.
Ms Swanson won Paterson with a 10.5 per cent swing in 2016 after the retirement of long-time Liberal member Bob Baldwin and is a clear favourite to retain the seat on May 18.