ASIC levy reduced by Govt

The Federal Government will provide temporary relief to financial advisers by reducing the Australia Securities and Investments Commission (ASIC) levies charged for FY21 and FY22.

This relief would see ASIC levies charged for personal advice to retail clients restored to their FY19 level of $1,142 per adviser for the next two years (FY21 and FY22). The flat per licensee charge would remain at $1,500.

Treasurer Josh Frydenberg said: “While this relief takes effect, Treasury will also review ASIC's Industry Funding Model, to ensure it remains fit for purpose given structural changes taking place in the advice industry.

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“Through our efforts, the Morrison Government is easing cost pressures on financial advisers at a time when they need it most, while ensuring Australians have access to more affordable system.”

These changes included the single disciplinary body and the compensation scheme of last resort, which were currently working their way through the legislative system and would rely on industry funding.

The FY21 ASIC levy was expected to $3,138 per adviser, plus the flat fee of $1,500 – an increase of $712 from the previous financial year. 

Senator Jane Hume, Minister for Superannuation, Financial Services and the Digital Economy, said the ASIC levy had been the biggest issue raised by advisers to her.

“In 2020, during the worst days of the pandemic, thousands of Australians turned to their financial advisers,” Hume said.

“For so many Australians, considered advice from a professional and experienced adviser was what helped them through the worst of the COVID-induced recession.

“Ensuring that Australians can continue to access high quality, professional and affordable financial advice is so important as we emerge from the pandemic.”

Hume said this was in line with the Government’s broader program improve regulatory alignment and cut red tape for financial advice businesses.

“These changes will relieve advisers so they can focus on giving financial advice, while Australians can be confident that they will always receive affordable, high-quality advice,” Hume said.

“I want Australian households to have access to affordable, high quality advice, and this measure will take us one step closer on that journey.”

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This relatively small cost is peanuts compared to the BS red tape being piled on us, including the insane annual consent which was just rolled out last month. It is taking me 45 minutes per client and involves clients signing 2-5 forms each 4-7 pages long; and because we are in the middle of a pandemic, they must be posted to the client. Hume is just window dressing. She couldn't give a stuff about making advice more affordable. DDO and retrograde IP changes coming in 31 days and Hume thinks we can all relax and deliver affordable advice now because this fee is reduced?

Meanwhile ASIC has put its "Affordable Advice Project" on hold, due to costs associated with implementing "Another Disciplinary Body". Utterly farcical.

ASIC and the government are making it harder for consumers to access professional advice, while taking a hands off approach to most spruikers, influencers, and scams. It is an absolute disaster in the making.

45 mins! that has to be an underestimation. Its taking us about the same to produce the forms, but then to send them out and chase up the forms from the client, plus getting the right forms to the product provider means its taking way longer than 45 minutes. God forbid you make a mistake on the form and you have to restart the whole process again.

Thanks AIOFP for having the guts to really apply pressure to Frydenberg, Hume & LNP.
Their treatment of Advisers and ever increasing BS Regs & Red Tape costs over last 8 years has been disgusting.
Finally they just maybe starting to listen as Real Advisers muster themselves and clients to vote down Frydenberg, Hume & LNP.

Yep, you will get what you vote for. LNP will always bend over backwards to do everything they can for the big banks and AMP. Labor will do everything they can for the Industry Funds. Question is, which of those two groups (Big Banks or Industry Funds) do you think presents your best opportunity (or least-worse option)?

I'll believe it when I see it. Not enough for Josh to get my vote in the next election.

If you reallty want to make financial advice more affordable and accessible, then make it tax deductible.

Isn't the fixed advice fee charged directly to client tax deductible? I believe it is.

I will leave the final answer to the accountants and tax experts, but my understanding is advice is only tax deductible if it relates to personal taxable income. Since super is not a taxable income, superannuation advice is also not tax deductible.

tax experts? financial planners are tax experts.

TD 95/60

TR 93/17

My understanding is that the cost of inital advice is a capital expense rather than a deductible income expense. Ongoing advice expenses may be deductible if they are related to personal income i.e., not super.
Happy to be corrected by an accountant, as they are always more than happy to correct an adviser.

Very grey area, definitely not for super or pension advice but possibly for investment advice

On one hand Hume acknowledges 'thousands of Australians turned to their financial advisers'...' during the worst days of the pandemic'. Yet she has imposed totally insane new requirements on financial advisers, with the overly complex fee consent legislation during a bloody lockdown, plus more red-tape and disruption to come in 31 days thanks to DDO and retrograde IP changes.

she is kidding, she wants everyone to get advice from their uber driver, or tik tok.

Sadly I believe she is just not interested. She does not care. She has her eyes set different agenda. I think she is focusing on the 2022 election and her career position after the election! Check out her facebook page for anything to do with official work portfolio.

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