The Tax Practitioners Board (TPB) directly addressed financial advisers via a YouTube video that provided much-needed guidance as to the regulations for the looming Tax Agent Services Act (TASA).
TPB Chair Ian Taylor appeared in the video, which was uploaded onto the TPB website, and gave preliminary information about which advisers will be required to register with TASA.
To be considered to be tax financial advice, the advice must consist of five key elements, he said:
- It must be a tax agent service (excluding representations to the commissioner of taxation).
- It is provided by an Australian financial service licensee or representative.
- It is provided in the course of financial advice normally given by an Australian financial service licensee or representative.
- It relates to ascertaining or advising about liabilities, obligations or entitlements that arise, or could arise, under a taxation law.
- It is reasonably expected to be relied upon by the client for tax purposes.
“This will help you determine whether the services you provide will be covered by the definition,” said Taylor. “Transitional arrangements will be in place over the next three years, so financial advisers who need to register with the TPB can do so.”
ASFLs will also be able to notify the TPB board on behalf of their authorised representatives who provide tax financial advice services, he said.
From 1 January 2016 AFSLs and all their authorised representatives as defined in the Corporations Act 2001 will also be able to seek registration.
The first 18 months from when the regulations are introduced on 1 July 2014 will be known as the notification option.
From 1 January 2016, advisers can either choose the transitional option, which is valid until 30 June 2017, or they can go straight into the standard option.
Taylor said the TPB will be writing to ASFLs with further information.
Until then, the video and more information about different timeframes and options are available on the TPB website.