FPA challenges TPB to properly define 'tax financial advice'

The Financial Planning Association (FPA) has hit out at the Tax Practitioners Board (TPB) for failing to align the rules for tax financial advisers with the Financial Adviser Standards and Ethics Authority (FASEA) regime while failing to define what actually represents tax financial advice that falls outside the definition of financial advice.

In a strongly worded submission to the TPB the FPA said it was extremely disappointed “by the TPB’s reluctance to unconditionally accept the [Continuing Professional Education] CPE 1 completed for FASEA purposes as meeting the TPB CPE requirements for tax (financial) advisers (TFAs).

“The FPA notes that the TPB have mirrored many of the FASEA requirements in the proposed amendments to its CPE policy. However, as these proposals do not replicate in whole the higher FASEA requirements without conditions, it creates two mis-matched systems that will lead to confusion and more red tape for tax (financial) advisers,” the FPA said.

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“Since the 11 February 2021 release of the Exposure Draft CPE Policy for TFAs for public consultation, the FPA has received feedback from numerous practitioner members stating that the TPB draft policy (for example):

  • Is confusing
  • Requires TFAs to undertake an additional 120 hours of CPE on top of the FASEA requirement, and
  • Does not align with the record keeping timeframes for FASEA CPE which will mean that TFAs will need to maintain two sets of records.”

It said that, most significantly, “practitioners are confused about:

  • What exact TFA services they provide that are not also personal financial advice services under the Corporations Act, and
  • Therefore, what topic areas of CPE are not captured under the FASEA requirements, through the individual’s licensee approved CPD Plan, that the TPB would expect a TFA to undertake.”

The FPA said it had to continually request that Treasury and the TPB provide clear examples of TFA services that fall outside the definition of personal financial advice since the proposed application of the Tax Agent Services Act to financial planners in 2008.

“Clear examples of services and circumstances in which a financial planner would be providing a tax (financial) advice service, but not personal financial advice, would help the profession identify the gaps in the CPE undertaken for FASEA purposes.”

“Without clear examples of these services, the TPB’s proposed CPE policy for TFAs is confusing and unnecessarily creates additional red tape for financial planners that will provide no extra benefit for consumers,” the FPA said. “Rather, it will drive up the cost of financial advice for Australians.”

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Yep only the moronic 9 different regulators involved in the massive BS over compliance of Advice could come up with 9 different ways to report, record and certify the same COD training.
This CPD debacle is the most clear example of massive multiple level duplications.
Surely MIA Jane, FARSEA, ASIC, TPB, FPA, SMSFA, etc could make the same 1 hour of CPD universally certified and accepted.
What a load of complete and utter bureaucratic buffoons feathering their own nests at expense of Advisers.
And use it as an example to start fixing the crazy multiplication of 9 different sets of conflicting rules, standards, laws, etc

The last paragraph hits the nail on the head. The test for all regulation, not only the application of TASA to financial advice but also (hopefully) the more practical recommendations that will flow from the ALRC's review into the Corporations Act, should be "is this regulation for regulation's sake or does it lead to better consumer outcomes (real not perceived) without driving up the cost of delivery to the point that the consumer cannot benefit from service."

Well done FPA, most of us have been asking this questions since the TPB became part of our lives. Having just paid out 2 lots of $560 with 2 more to go just for the privilege of telling a client their income protection premiums are tax deductible, I seriously wonder that this body actually is good for. Another layer of bureaucracy like we don't have enough already. My question to the TPB would be: "is this the revenge for the Government placing a need for limited licensing on accountants for SMSF advice?" I hope it's not as petty as that.

Sorry to say Duke that you are very close to the mark. Whilst the TPB are more than happy to expand their empire and take our hard earned cash the pettiness really came from the accounting associations (CPA, CA, NTAA) whose members were very angry about the limited licensing regime impacting their SMSF businesses and sought revenge. I was at the time a member of one of those associations and some of the internal dialogue was unbelievably petty and there was concerted lobbying to enforce the TPB on advisers. I quit my membership in disgust.

Pretty sure it s exactly that !!!

Look at the timing of the Accountants Limited AFSL's and the TPB imposition of Advisers.
It was a complete Govt snow job on Advisers to placate a little Accountants.
Yep as per usual from Canberra bubble morons:
at every turn ADD MORE REGS, ADD MORE REGS, ADD MORE REG !!!!!!!!!!!!!!!!!!!

Typical... The government and the TPB get into a fight and we're the losers. :P

All the more reason why financial advisers should be removed from TPB regulation altogether. The government's own TPB review recommended this over 2 years ago. The Hayne RC effectively recommended it by proposing a SINGLE disciplinary body. Yet still MIA Jane does nothing.

The FPA shouldn't be wasting time on the minor details of TPB standards. They should be lobbying the govt to hurry up and remove TPB from financial adviser regulation.

The FPA won't get any joy from tax or legal professionals. We are the bottom dwellers in their eyes and the ' profession'' keeps shooting itself in the foot - continued vertical integration remains the chief problem and until we let it go, they'll never accept we can't stand on our own feet and beside them. My 2 bobs.

Totes agree that Vertical Integration has to go.
The biggest Elephant that the RC ran away from, no doubt at the direction of Frydenberg.
But for the record there are many accounts that work with and next to Advisers in great teams for the best of clients. It is not always perfect or harmonious and there are many demarcation issues. But it does work very well for clients and good Accountants and Advisers.

How is it that financial planners don't know what tax services they provide outside of personal financial advice? One takes into account a clients full set of circumstances, the other one doesn't doh! Maybe financial planners should be made to re-sit their HSC...

Please, let rip and deliver the clear definition sort from the TPB and demonstrate once and for all your clear brilliance and that what is lacking in all Financial Planners.
Perhaps follows will, in time, erect monuments of you.

You’re right. With a simple Cert IV, easily rolled in under 6 months most planners would comfortably be able to take over 90% of the ITR, BAS and SMSF world. It’s basic stuff, legislated and requires zero creativity. Half of it is pre-filled these days. Hope you accountants are building out your advisory work because compliance work is drying up quick smart.

you are on the money, Felix. but, the trouble is that accountants don't know how to offer value-added advisory services.

they have existed by virtue of statute, that is, the requirement to file a tax return, now the ATO themselves are bypassing them direct to the client, and so they should.

my question to any accountant is what is your practice going to look like the day the ATO does what happens in NZ?

for all of you (this is another 1 CPD approved post from me), up to 75% of NZer's do not file tax returns the IRD (inland revenue Department Māori: Te Tari Taake) and equivalent of the ATO just issues a notice of assessment to kiwis. if they disagree they can object.

over 18,000 Ca's and CPA's do not even have a first degree, they are grandfathered. most cannot even touch type.

they don't know what a value proposition is. they exist because of statute.

I continue to question the relevance of the TPB in the financial planning world. Just another organisation adding cost to the convoluted regulatory regime. Rationalisation of the regulatory regime would be in the best interests of the majority of consumers.

22,000 advisers are members of the TPB and not a single financial planner sits on the TPB, board. ZIP, NIL NONE. We represent over a third (YES A THIRD) of their membership and yet the TPB board is nothing but old male Accountants from KPMG. There is a reason why the ATO don't deal with planners. Poor representation leads to poor outcomes and the TPB board generating jobs for themselves and their own self importance. Write to Treasury and ask "why is the TPB jobs for the boys".

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