Termination of Tax (financial) Adviser registrations - June 2020

Overview

The Tax Agent Services Act 2009 (TASA) was enacted by the Australian Parliament to establish a regulatory framework for tax practitioners, ensuring that individuals and entities providing tax services meet professional standards and comply with legislative requirements. The Act aimed to address the problem of unprofessional conduct and inadequate qualifications among tax agents, which could lead to financial harm for clients and undermine the integrity of the tax system. The policy objective of the Act is to protect consumers by ensuring that tax agents are competent, ethical, and operate in accordance with established standards. The Tax Practitioners Board, established under the Act, has the authority to register tax agents, monitor their conduct, and take action against those who fail to meet the required standards. The Board’s recent actions to terminate the registrations of various tax agents underscore its commitment to enforcing compliance with the Act’s provisions.

Scope and Application

The Tax Agent Services Act 2009 (TASA) applies to tax agents and tax (financial) advisers who are registered under the Act, ensuring that they meet certain professional standards and regulatory requirements. This Act operates at the Commonwealth level, thereby having a national reach, impacting entities and individuals involved in providing tax agent services across Australia. The Act does not specify particular exclusions but provides exemptions for certain activities and services, such as those related to the Australian Taxation Office (ATO) and other government entities, as well as those activities explicitly listed in the regulations. The scope of the Act can be extended or restricted through subordinate instruments, which allow for more detailed regulations and standards to be set for the conduct of tax agents and financial advisers. The termination of registration of tax agents and financial advisers, as seen in the gazette, highlights the importance of compliance with the Act and the potential consequences for non-compliance or voluntary surrender of registration.

Key Provisions

The main operative sections of the Tax Agent Services Act 2009 (TASA) relevant to the termination of tax (financial) advisers' registration include subdivisions 40-A and 30-B. Subdivision 40-A addresses the termination of registration through surrender or other means, while subdivision 30-B pertains to termination due to failure to comply with the code of professional conduct. The Act allows the Tax Practitioners Board to terminate the registration of tax (financial) advisers under these subdivisions, as evidenced by the terminations listed in the gazette. Each termination specifies the effective date and the reason, which may include surrender or failure to comply with the professional conduct code. The Tax Practitioners Board, as the governing body under the Act, has specific obligations to ensure that tax (financial) advisers meet the required standards of professional conduct and compliance. This includes monitoring and enforcing adherence to the code of professional conduct outlined in the Act. The Board must conduct investigations and assessments when there are grounds to suspect non-compliance or other reasons warranting termination of registration. The Act requires the Board to provide a clear and transparent process for the termination of registrations, ensuring that all parties are informed of the reasons and effective dates of termination. Breaches of the Act's provisions can result in severe consequences, including termination of registration, fines, and potential criminal charges. Under the Act, failure to comply with the code of professional conduct can lead to termination of registration as seen in the case of Christopher Edward Bunce (subsection 30-B). Additionally, the Act does not explicitly state maximum penalties for breaches, but non-compliance with professional standards could lead to further civil or criminal proceedings depending on the severity of the breach. It is crucial for tax (financial) advisers to maintain compliance with the Act to avoid such repercussions.