BGL would like to see all accountants provide a response to the “Review of the Tax Practitioners Board Discussion Paper July 2019”. Option 7 in Section 10.14 of the report would effectively bring back the Accountant’s Exemption.
“BGL has been vocal for many months about the need for the return of the accountant’s exemption or something similar,” said Ron Lesh, BGL’s Managing Director. “The Institute of Public Accountants has also been vocal about the need for change and more recently even the CAANZ have publicly supported the proposal. It is great to see some of the accounting organisations getting out there and supporting their members.”
“Everyone agrees the current system for SMSF advice is simply not working” added Lesh. “ASIC’s shadow shopping each year provides predictable poor compliance results and now even the Treasury has realised this is something in desperate need of repair”.
Last year, BGL asked clients to complete a survey around AFSL’s. The survey results told us:
- Over 40% of our clients do not hold an AFSL and are not Authorised Representatives
- Around 60% provide SMSF establishment, contribution, pension and wind up advice
- Only 24% provide investment advice
- 60% said the current licencing regime was poor, expensive and ridiculously onerous.
“With over 1,200 responses, the results were clear: Accountants want their representative bodies to push for a reinstatement of the Accountant’s Exemption!”, noted Lesh.
“This year BGL has taken research further with our business partner A.S.A.P. Actuarial as to where clients stand regarding ASFL’s and why they are not using online Statements of Advice (SOA) tools. The preliminary survey results are fascinating” said Lesh
- One third of new SMSFs and half of new SMSF pensions are set up with no SOA
* Accountants who are licensed often help, but with no SOA
- The main reasons for not getting an SOA were:
– The client was reluctant to pay – 66%
– The client does not trust advisers – 50%
– The SOA adds little if any value – 50%
- Nearly 60% of accountants were concerned or very concerned about doing this.
“We think it is imperative accountants tell the Treasury that Option 7 is the result the accounting industry needs”
Option 7 in the “Review of the Tax Practitioners Board Discussion Paper July 2019” would allow financial advisers that provide incidental tax advice to not have to be registered with the TPB. At the same time there are reciprocal arrangements that permit tax advisers/accountants to provide incidental financial advice which in effect restores the concession that was previously available to accountants that are registered tax practitioners.
Accountants can provide their response to Nick Westerink at the Treasury by email to [email protected] by 30 August 2019.