TheFinancial Planning Association (FPA)has accused theAustralian Tax Office (ATO) of discrimination over its decision to exclude financial planners from its settlement offer on so-called mass marketed tax effective schemes.
In a letter to the ATO, the FPA said it was concerned financial planners who invested their own money in the tax effective schemes could not take up the ATO’s settlement offer like other investors.
FPA chief executive Ken Breakspear says the omission of financial planners from the settlement proposal amounted to discriminating between different classes of Australians based on their profession.
He says other professionals, who may have been in a position to promote the schemes, including lawyers and accountants, have received far more favourable treatment from the tax office.
“It appears that accountants and lawyers are able to access the settlement offer — but not financial planners. Such discrimination breaches Australia’s social fabric of treating all Australians equally,” Breakspear says.
Breakspear says financial planners who have not inappropriately advised clients on tax effective schemes should be considered on the same footing as other investors by the tax office.
“If a professional has not been charged with any wrong doing by the licensing authority and has acted in good faith on behalf of their clients they should then be entitled to access to the settlement offer,” Breakspear says.
Under the ATO’s settlement offer, announced in February, scheme investors, who received a total of $4.5 billion in tax deductions over a 10 year period only to have the deductions retrospectively disallowed by the ATO, will not be charged penalties or interest on the tax debts they now owe the ATO.
Investors in the schemes will also have a two year interest free period to repay outstanding debts to the tax office.
Breakspear says the FPA will seek an urgent meeting with the ATO in an attempt to resolve the issue before the 30th of this month, the closing date for investors to accept the tax office’s settlement offer.
