New tax advice regime starts today

The Tax Practitioners Board (TPB) has overnight released final guidelines for advisers on key issues of PI insurance and education requirements under the TASA regime commencing today.

Licensees and authorised representatives who provide “tax (financial) advice” services to consumers will begin registering with the TPB from July 1, as stipulated in the previous government’s amendments to the Tax Agent Services Act.

In an article for the July edition of ifa magazine, FPA general manager, policy and conduct, Dante De Gori wrote that “in practice any individual who is authorised/licensed to provide ‘personal financial product advice’ is likely to be captured” by the new regime and TPB registration requirement.

Alternatively, from today, advisers who come under the regime may use a “relevant disclaimer when they provide tax (financial) advice services for a fee or other reward” within statements of advice – though this disclosure option is only available until December 2015, after which point full TPB registration will be expected, according to TPB documents.

Last night, the TPB issued its final requirements regarding PI insurance for tax (financial) advisers, including that an individual acquire and maintain “professional indemnity insurance that [includes] tax advice” – unlike the basic ASIC requirement – or are covered under such a policy held by “another registered tax (financial) adviser entity”.

On the contentious issue of continuing professional education requirements – on which the advice industry associations have been lobbying heavily in recent months – the TPB has ruled that registered advisers will need to complete a “minimum of 60 hours of [continuing professional education] over three years”, including no less than seven hours in any given year.

Registered advisers will also be required to comply with a TASA Code of Conduct, which imposes additional conflicts of interest management and client confidentiality requirements, among others.

Non-compliance with the code or aforementioned new requirements will result in sanctions from the TPB.

Speaking to ifa this morning, Mr De Gori said there is “nothing unexpected in these final guidance documents” from the FPA’s perspective.

“However, what this reinforces is that with CPE your membership of a TPB-approved professional body means that you will already be complying with your TPB CPE requirements,” he said.

“So for planners who are members of the FPA, the CPE requirements are not additional but rather inclusive of their existing CPE obligations.”

The final TASA obligation documents can be accessed here: http://www.tpb.gov.au/TPB/Publications_and_legislation/I/0609_TPB_I__20_2014_tax_financial_advice_service.aspx

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