The Assistant Treasurer today [Mon 29.11.2010] released for comment a paper which sets out options for the regulation of financial planners who provide tax agent services. This follows the Government’s announcement to defer the application of the tax agent services regime until 1 July 2011 for such financial planners to allow extra time for consultation: see 2010 LTN 211 [2].

Mr Shorten said the paper presents 2 options for consideration:

  • Option 1 – bring tax agent services provided by financial planners permanently within the tax agent services regime and be regulated by the Tax Practitioners Board, but do so in a way that minimises any additional compliance burden.
  • Option 2 – investigate and implement what changes, if any, might be made to the Australian Financial Services Licensing regime or its enforcement to ensure financial planners offering tax agent services are regulated to the same standards imposed on tax agents.

Comments are due by 25 December 2010. (Source: Assistant Treasurer’s press release No 018, 29 November 2010.)

Taxation Institute of Australia RESPONSE: The TIA says the Federal Government has an opportunity to close a loophole and ramp up consumer protection with the release of the paper. The paper confirms that doing nothing is not an option, Taxation Institute Senior Tax Counsel, Robert Jeremenko, said. “People relying on tax advice should expect that their adviser meets the highest standards as the Tax Agent Services Regime offers, and that they are also covered by the sorts of protective measures it offers”, he said. (Source: TIA media release, 29 November 2010.)