A disqualified entity (DE) is an entity (including an individual) that is not a registered tax agent, BAS agent, or a 'qualified tax relevant provider' (QTRP) and has had an event specified in the Tax Agent Services Act 2009 (TASA) occur in the last 5 years, which disqualifies them from providing tax agent/BAS services on behalf of a registered tax practitioner.  

Under the TASA, registered tax practitioners cannot employ or use the services of a 'disqualified entity' to provide tax agent/BAS services on their behalf, without approval from the Tax Practitioners Board (TPB). This means that practitioners must exercise due diligence when employing or using individuals and other entities to ensure they are suitable to provide tax agent services on their behalf.

For a full definition of what is a disqualified entity refer to TPB(I) 41/2024 Employing or using a disqualified entity in the provision of tax agent services without approval.

The measures are intended to maintain the integrity of the taxation system, reduce tax fraud and evasion, and protect consumers by ensuring that those employed or used by tax practitioners have the appropriate ethical and professional attributes to be engaged in the tax profession.

If you intend to employ or use (or continue to employ or use) a disqualified entity to provide tax agent services on your behalf, you must apply to the TPB for approval. 

You must use our approved form which can accessed by logging in to My Profile. The application must be accompanied by the relevant information as specified on the form.  

Before applying you should also ensure that the disqualified entity has provided their written consent to you to make an application for approval to the TPB. Written consent can be provided using the Disqualifying events declaration and consent form.

Transitional provisions have ceased on 31 December 2024 and these provisions applied to tax practitioners who employed or used a disqualified entity before 1 January 2024.  For further information about the transitional provisions, refer to our Information sheets:

• TPB(I) 41/2024 Employing or using a disqualified entity in the provision of tax agent services without approval
• TPB(I) 42/2024 Prohibition on providing tax agent services in connection with an arrangement with a disqualified entity.

The TPB will typically decide an application for approval within 60 days of receiving the complete application, or within a longer period if agreed between the TPB and registered tax practitioner.

If you engaged a disqualified entity prior to 1 January 2024, you had 12 months (until 31 December 2024 (inclusive)) to either cease employing the disqualified entity to provide tax agent services, or obtain TPB approval to continue. For further information about your obligations, refer to our guidance. 

You must notify your employer (or the tax practitioner who uses your services) within 30 days after you become aware (or ought to be aware) that you are a disqualified entity.

If you are a registered tax practitioner and you do not comply with the disqualified entities requirements, you may be in breach of the Code of Professional Conduct. We may impose sanctions for the breach.

If you are a disqualified entity and you do not notify the tax practitioner who employs or uses your services that you are disqualified, you may be liable for civil penalties. Refer to the civil penalty provisions for further information.

Code item 15 is not intended to apply in respect of individuals or other entities who only provide peripheral services to assist a registered tax practitioner, for example, administrative support staff. If sending copies of a Notice of Assessment does not involve providing any tax agent service (i.e. the preparation of a return, or lodging with the ATO), then this would not come within the scope of services covered by Code item 15.

The obligation to ensure a disqualified entity does not provide tax agent service on your behalf falls on the tax practitioner, and not on an unregistered entity like the employment service provider. You can work with the provider to ensure they do not refer staff to you who do not meet your requirements, but ultimately the obligation to comply with the Code sits with the tax practitioner.

We do not keep a register of entities who are disqualified. However, our Public Register does publish information that may indicate a disqualifying event has occurred within the last 5 years (i.e. a sanction). However, some disqualifying events are not published on the Register – because of this, we require tax practitioners to ensure the individual is aware of the requirements of Code Item 15 and completes the Disqualifying events declaration and consent form. 

You do not need to provide this form to the TPB, but you can retain a copy of it as evidence of the reasonable steps you have taken to ensure the individual you have employed is not a disqualified entity.

An individual ‘becomes an undischarged bankrupt’ if they have been declared bankrupt under the Bankruptcy Act 1966 and have not been discharged from the bankruptcy. 

Note – even if an individual is no longer an undischarged bankrupt, that individual will remain a disqualified entity for the period within 5 years of the date they became an undischarged bankrupt. Their current credit history, or whether they are currently bankrupt, is not relevant to whether they are a disqualified entity at this time.

With respect to bookkeeping, you must consider whether the bookkeeping involves services which come within the definition of a tax agent service. This can vary between bookkeepers. Code item 15 only applies to services provided on your behalf if they are tax agent services. For further guidance on what is (and isn't) a tax agent service, please refer to our Information sheet.

There are 2 key steps to checking whether an entity is disqualified, in particular if they have changed their name. Our Public Register publishes information that may indicate a disqualifying event has occurred within the last 5 years, and in some cases the Register will also publish the entity's previous names.

However, some disqualifying events are not published on the Register. Because of this, we require tax practitioners to ensure the individual is aware of the requirements of Code item 15 and completes the Disqualifying events declaration and consent form.

We recognise that these are new obligations and our guidance will not be finalised until after 1 January 2024. We will be pragmatic in addressing any compliance concerns you may have between 1 January 2024 and the date our guidance is finalised. Nevertheless, it's crucial that you familiarise yourself with and establish processes in your practice to adhere to Code Items 15 and 16.

If you discover that another registered tax practitioner is contracting a disqualified entity to provide tax agent services on their behalf (without our approval), this may be a breach of the Code. If this is the case, you may have an obligation to report this breach to us (and any relevant recognised professional association). Please refer to our guidance on breach reporting for more details.

Our application form has a combined file size limit of 20 MB, you’ll receive an error message if you attempt to attach files larger than the maximum size limit. We would suggest either trying to compress the file or save in a PDF format to reduce the size.

We only accept Australian addresses.

The online form (available on My Profile) is the TPB’s application form for you to seek approval to employ or use a disqualified entity to provide tax agent services on your behalf. The Disqualifying events declaration and consent form is evidence of you having undertaken due diligence when engaging entities to provide tax agent services on your behalf. It also provides for a disqualified entity’s declaration of consent for you to seek the TPB's approval, and their notification in writing to you that they are a disqualified entity. 

For further information, refer to:

• Code obligations when you employ, use or have an arrangement with a disqualified entity
• TPB Information Sheet 41/2024 Employing or using a disqualified entity in the provision of tax agent services without approval
• TPB Information Sheet 42/2024 Prohibition on providing tax agent services in connection with an arrangement with a disqualified entity.