Planners deferred from tax agent services regime
Assistant Treasurer Senator Nick Sherry has announced further details about the new national tax agent services regime, including a one-year deferral for financial planners from the application of the regime.
During the period of deferral a comprehensive industry consultation will take place to assess which of the two permanent options should be applied to Australian Financial Services Licensee (AFSL) holders providing financial planning advice, according to a Government statement.
The two options are: to investigate and implement any changes that may need to be made to the AFSL regime to ensure that it provides comparable regulatory supervision of tax services provided by financial planner to that of other tax services providers; or to bring financial planners permanently within the tax agent services regime and therefore be regulated by the Tax Practitioners’ Board.
“This consultation provides time to consider whether this outcome is best achieved by requiring financial planners providing tax advice and services within the scope of their AFSL to register under the tax agent services regime, or whether the regulatory outcomes we all agree are important are already adequately achieved, or could be achieved, through the AFSL regime itself,” Sherry said.
The final form of the deferral would be subject to consultation with stakeholders, but Sherry stressed that the deferral would only relate to services that were already covered by the AFSL regime.
“This deferral has nothing to do with cases where a financial planner wishes to provide tax services outside the AFSL regime limitations, such as completing tax returns for example. If you’re a planner and you provide these kinds of services there is no doubt you’re under the tax agents’ regime,” Sherry said.
The increased coverage of the tax agent services regime also includes an extension of the exemption to those providing advice ‘in-house’ within a tax consolidated group to cover services provided between other related entities.
The arrangement will also extend to include services provided between entities that are part of the same GST group; services provided by an entity in discharging its own formal obligations to another entity; services provided between separate legal entities that are carrying on a common economic enterprise and have the same or similar owners; and services provided between dual listed companies and between joint venture partners.
The regime, which commenced on 1 March this year, replaced the six existing state-based Tax Agents’ Boards with a single national system.
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