Termination of Tax (financial) Adviser registrations - July 2020

Overview

The Tax Agent Services Act 2009 (TASA) was enacted to regulate the tax (financial) agent industry in Australia, ensuring that registered tax agents comply with professional standards and requirements. The Act was introduced to address issues such as the need for better regulation, improved standards of professional conduct, and increased consumer protection within the tax (financial) agent sector. The Act was enacted by the Parliament of Australia and its policy objective is to safeguard the interests of taxpayers by ensuring that tax (financial) advisers meet the necessary qualifications and adhere to a code of professional conduct. The Act established the Tax Practitioners Board to oversee the registration and regulation of tax (financial) agents, and to take action against those who fail to meet the required standards. The gazette C2020G00959 published by the Tax Practitioners Board lists the terminations of the registrations of various tax agents, either by surrender or for not meeting the registration requirements, effective from specified dates.

Scope and Application

The Tax Agent Services Act 2009 (TASA) governs the registration and professional conduct of tax (financial) advisers in Australia. This Act applies to individuals and entities providing tax services, encompassing activities such as tax agent services, BAS agent services, and related financial advice. The jurisdiction of TASA spans across the Commonwealth of Australia, ensuring uniform standards for tax practitioners regardless of the state or territory. The Act applies to all persons or entities engaged in the provision of tax services, thereby regulating their professional conduct and ensuring compliance with prescribed standards. The geographic reach of the Act is national, covering all tax (financial) advisers operating within Australia. The Act provides for exclusions and exemptions, such as certain types of financial advice not regulated under the Act, and specifies thresholds for registration based on the nature and scale of services provided. The application and enforcement of the Act may be extended or restricted through subordinate instruments, which allow for the creation of regulations and guidelines to further detail the requirements and processes outlined in the primary legislation.

Key Provisions

Under the Tax Agent Services Act 2009 (TASA), the Tax Practitioners Board (TPB) has the authority to terminate the registration of tax agents who either surrender their registrations or no longer meet the registration requirements (sections 40-140 and 30-160). The main operative sections relevant here are sections 40-140 and 30-160, which provide the legal basis for the TPB to terminate the registration of tax agents. Section 40-140 allows the TPB to terminate the registration of a tax agent who voluntarily surrenders their registration, while section 30-160 permits the TPB to terminate the registration of a tax agent who no longer meets the necessary requirements. The TPB has a responsibility to ensure that all tax agents meet the specified registration requirements, including ongoing professional development and adherence to ethical standards. The TPB also has the authority to investigate complaints and to take disciplinary action against tax agents who engage in unprofessional conduct or who fail to meet the requirements for registration. The entities and individuals listed in the gazette have either voluntarily surrendered their registrations or have been found not to meet the registration requirements, leading to the termination of their registrations. Failure to comply with the requirements of the Tax Agent Services Act 2009 (TASA) can result in criminal or civil penalties. For example, section 330-10 of the TASA imposes a maximum penalty of 2,500 penalty units (approximately AUD 455,000) for each offence of providing a tax service while unregistered. Similarly, section 330-15 of the TASA imposes a maximum penalty of 5,000 penalty units (approximately AUD 910,000) for each offence of providing a tax service while disqualified from registration. Additionally, individuals or entities found guilty of engaging in fraudulent or dishonest conduct may face imprisonment, fines, or both. The penalties for breach of the TASA are designed to deter non-compliance and to protect the public from unprofessional or dishonest conduct by tax agents.