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FPA welcomes Government decision on tax agents

By: admin|

Concerns have also been raised about the coverage of the regime to AFSL holders providing financial planning advice. The Australian Securities and Investment Commission (ASIC) currently regulates all ASFL holders.

“I am of the view that financial planners, in many respects, do offer what amounts to tax advice – this is also the view, as provided to me, of the Tax Practitioners’ Board (TPB) and of ASIC,” said the Assistant Treasurer.

“ASIC also advise that they currently regulate financial planners in respect of all their functions, including tax-related aspects.”

“Of course, we now also have the TPB which is charged specifically with regulating tax advice where it is provided for a fee.”

“In order to end the current uncertainty being experienced by financial planners, and also to allow consultation with other sectors of the tax community, I have determined to provide a one-year deferral to financial planners from the application of the tax agents’ regime.”

An amendment will be made to the Tax Agent Services Regulations 2009 to confirm this deferral arrangement. During the period of deferral a comprehensive industry consultation will take place to assess which of two permanent options should be applied to AFSL holders providing financial planning advice.

The Assistant Treasurer indicated these options were:

  • to investigate and implement what changes, if any, might be made to the AFSL regime or its enforcement to ensure that it provides a comparable level of regulatory supervision in relation to tax services provided by financial planners in comparison to the level of supervision imposed on the providers of tax services regulated by the TPB; or
  • to bring financial planners permanently within the tax agent services regime and therefore be regulated by the TPB, but to do so in a way that minimised any additional compliance burden.

“This consultation provides time to consider whether this outcome is best achieved by requiring financial planners providing tax advice and services within the scope of their AFSL to register under the tax agent services regime or whether the regulatory outcomes we all agree are important are already adequately achieved, or could be achieved, through the AFSL regime itself,” the Assistant Treasurer said.

“I believe it is important, if possible, to avoid dual licensing, supervisory and inspection regimes which add to red tape and cost.”

The final form of the deferral would be subject to consultation with stakeholders, but the Assistant Treasurer stressed that the deferral would only relate to services that were already covered by the AFSL regime.

“This deferral has nothing to do with cases where a financial planner wishes to provide tax services outside the AFSL regime limitations, such as completing tax returns for example. If you’re a planner and you provide these kinds of services there is no doubt you’re under the tax agents’ regime,” the Assistant Treasurer said.

23 April 2010

Press Release 072

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