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Events that may affect your continued registration as a tax (financial) adviser

Events that may affect your continued registration as a tax (financial) adviser

There are certain events that may affect your continued registration as a registered tax practitioner.
Where it is a partnership that is the registered tax practitioner - the event may be one that affects an individual partner in the partnership, and/or a partner who is a director of the company.
Where it is a company that is the registered tax practitioner - the event may be one that affects a director of the company.

Events

 You are convicted of a serious taxation offence

'Serious taxation offence' means:

  1. an offence against any one of the following sections of the Criminal Code Act 1995 (Criminal Code), if the offence relates to a tax liability (within the meaning of the Taxation Administration Act 1953).
  • section 134.1 – obtaining property by deception
  • section 134.2 – obtaining a financial advantage by deception
  • section 135.1 – general dishonesty with respect to obtaining a gain, causing a loss or influencing a Commonwealth public official
  • section 135.2 – obtaining a financial advantage
  • section 135.4 – conspiracy to defraud with respect to obtaining a gain, causing a loss or influencing a Commonwealth public official.
  1. a 'taxation offence' that is punishable on conviction by a fine exceeding 40 penalty units, or imprisonment, or both.

One penalty unit = $210.

'Taxation offence' means:

  • an offence against a taxation law
  • an offence against:
    • section 6 of the Crimes Act 1914 – being an accessory after the fact relating to an offence against a taxation law
    • section 11.1 of the Criminal Code – attempting to commit an offence relating to an offence against a taxation law
    • section 11.4 of the Criminal Code – incitement to the commission of an offence relating to an offence against a taxation law section 11.5 of the Criminal Code – conspiring with another person to commit an offence relating to an offence against a taxation law.

You are convicted of an offence involving fraud or dishonesty

'Fraud' and 'dishonesty' take their ordinary meaning, and are determined by reference to community standards.

The Criminal Code defines 'dishonest' as dishonest according to the standards of ordinary people in circumstances where the defendant is aware of these standards.

Example

Patricia was convicted of theft and was fined $1,500. To convict an individual for theft, a court must find that the individual has dishonestly appropriated property belonging to another with the intention of permanently depriving the other person of the property. Consequently, theft is an offence of dishonesty and we must consider this in determining whether Patricia satisfies the fit and proper person test for registration.

You are penalised for being a promoter of a tax exploitation scheme

You are considered to have been penalised for being a promoter of a tax exploitation scheme if you have been ordered to pay a civil penalty for engaging in conduct that results in you, or another entity, being a promoter of a tax exploitation scheme, within the meaning of Division 290 of Schedule 1 to theTaxation Administration Act 1953.

You are penalised for implementing a scheme that has been promoted on the basis of conformity with a product ruling in a way that is materially different from that described in the product ruling

You are considered to have been penalised for implementing a scheme that has been promoted on the basis of conformity with a product ruling in a way that is materially different from that described in the product ruling if you have been ordered to pay a civil penalty for engaging in such conduct as defined within Division 290 of Schedule 1 to the Taxation Administration Act 1953.

You become an undischarged bankrupt or you go into external administration

Undischarged bankrupt

You are an undischarged bankrupt if you have been declared bankrupt under the Bankruptcy Act 1966 and have not been discharged from the bankruptcy.

Example

Seven years ago, William was declared bankrupt and was not discharged until three years ago. Although William was declared bankrupt more than five years ago, having the status of an undischarged bankrupt at any time during the past five years is a factor we must consider in deciding whether William is a fit and proper person for registration purposes.

External administration

A company will go into external administration for the purposes of the Tax Agent Services Act 2009 if it goes into external administration as defined in the Corporations Act 2001.

You are sentenced to a term of imprisonment

You are considered to have been 'sentenced to a term of imprisonment' if a sentence is imposed on you in relation to an offence and that sentence includes a term of imprisonment. This does not require you to have actually served all or part of that term of imprisonment, only that you were sentenced to a term of imprisonment.

Example

Three years ago, Melissa was convicted of dangerous driving causing serious injury under section 319 of the Crimes Act 1958 (Vic) and received a two-year suspended prison sentence. Being sentenced to a term of imprisonment in the previous five years is an event we must consider in deciding whether Melissa is a fit and proper person for registration purposes.

When you must notify us

You must notify us in writing within 30 days of when you become, or ought to have become, aware of one of the above events occurring in respect of: 

  • for individuals – yourself
  • for partnerships – an individual partner or a director of a company partner
  • for companies – a director of the company.

Failure to comply with this requirement is a breach of the Code and we may terminate your registration.

When an event affects your continued registration

For individuals

If an event affecting your registration occurs, we may terminate your registration.

For partnerships

If an event affecting registration occurs in respect of a partner in your partnership, then we may require you by written notice to remove the partner from your partnership within a specified period.

If an event affecting your registration occurs in respect of a director of a company partner, then we may require the removal of:

  • the company partner, or
  • the director of the company partner.

Note: Failure to comply with a notice requiring you to remove a partner in your partnership, or a director of a company partner in your partnership, is a breach of the Code and we may terminate your registration.

For companies

If an event affecting your registration occurs, we may terminate your registration.

If an event affecting registration occurs in respect of a director of your company, then we may require you by written notice to remove the director from the board of directors within a specified period.

Note: Failure to comply with a notice requiring you to remove a director from your company is a breach of the Code and we may terminate your registration.

 

Last modified: 6 July 2017