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This months newsletter covers topics ranging from assessment of gifts as income; divorce and business; the rise in bankruptcy; and the new changes set to effect tax practitioners and how they will affect you.
The Government has legislated a series of changes to the Tax Agents Services Act 2009 that place additional requirements on registered tax practitioners and how they interact with clients. The reforms are in response to the recommendations of a Senate enquiry into the
actions of accounting group PwC and the consulting industry in Australia generally. Among other issues, the scandal revealed a series of flaws and deficiencies within the regulation of tax practitioner services, the investigative powers of the Tax Practitioners Board (TPB), and the ability of Government departments to share information. This has lead to a reform of the legislation that governs tax practitioners.
There has been a lot of upheaval amongst tax agents regarding the new reforms which are set to add additional obligation and compliance to an already highly monitored group of professionals.
Amongst the changes comes eight new items added to the tax practitioners code of conduct. The code includes measures to ensure all advisors assisting with the tax obligations for clients are fit and proper to do so. It also includes the requirement to ‘dob in’ not only other tax agents who may not be operating ethically, but also clients who knowingly make statements to avoid tax through material misstatement.
While many of the resulting legislative reforms impact consulting services to Government, we are now obligated to advise clients of: how to check the currency of our registration as tax practitioners; how to access the complaints process for registered practitioners; and, our obligation to report material uncorrected errors and omissions to the Tax Commissioner.
Many accounting associations have responded to the reforms stating that the changes seem to be targeted toward large multidisciplinary firms and that the additional obligations will be much harder for smaller firms to accommodate. They have requested that smaller firms be excluded from some of the changes. If these responses are not considered and all changes come into effect for smaller businesses like ours, we will be required to ask more questions of you, while also requiring more documentation from you at times.
Your patience and assistance as we navigate the new reforms is appreciated. To read more about the reforms as well as the other topics included in this months newsletter please click here.
Kerrily and Louise – Directors
