Tax Practitioners Board Consultative forum report – 22 October 2013
On 22 October 2013, the Tax Practitioners Board (TPB) held a Consultative Forum (forum) in Melbourne with representatives from a number of professional associations. This was the third forum with the current Board and for 2013.
Board and TPB representation at the forum consisted of:
- Ian R Taylor – Chair of the Board
- Cynthia Coleman – Board member
- Russell Smith – Board member
- Rosemary Holloway – Secretary
- Janette Luu – Senior Adviser to the Chair of the Board
- Neil Pegg – Secretariat.
Representation at this forum consisted of:
- Australian Taxation Office
- Association of Accounting Technicians Australia
- Association of Taxation and Management Accountants
- Australian and New Zealand Association of Chartered Certified Accountants
- Australian Bookkeepers Association Ltd
- CPA Australia
- Financial Planning Association of Australia
- Institute of Certified Bookkeepers
- Institute of Chartered Accountants in Australia
- Law Council of Australia
- Law Society of New South Wales
- National Tax Agents' Association Ltd (NTAA+)
- Self-Managed Super Fund Professionals' Association of Australia
- Taxpayers Australia Inc. Tax Practitioners & Advisers Ltd (TAI PAL)
- The Tax Institute.
Apologies were noted from the Institute of Public Accountants, Royal Institute of Chartered Surveyors, and the New Zealand Institute of Chartered Accountants.
This draft report summarises the key points discussed at the forum. In accordance with past practice, it is intended only to provide an overview of the issues that were discussed and does not represent the final views of the Board, nor is it intended as minutes of the forum.
The Chair welcomed all attendees and introduced and welcomed the TPB's new Secretary Rosemary Holloway.
Update from the TPB
- As at the end of September 2013, the current year-to-date overall weighted average for processing registration applications is approximately 15 days.
- The TPB is constantly seeking to identify opportunities that enable streamlined processing and improve the end-user experience as part of a continuous improvement ethos. This includes consideration of relevant performance indicators to facilitate ensuring applicants clearly understand requirements across the whole registration process.
- In conjunction with an increasing awareness of the TPB, there has been a significant increase in the number of complaints, referrals and finalised cases in comparison to the previous year. Public complaints represent approximately 60 per cent of all complaints and referrals, with many finalised without further action. As at 30 September 2013, there were 413 matters on hand.
- The second edition of TPB's Summary of penalties, sanctions and terminations booklet was recently released on the TPB website and distributed to attendees.
- The forum noted the listing of recently issued TPB information products, including the second edition of the TPB's electronic newsletter (eNews) released on 24 September 2013. It was noted that open rates for eNews (approximately 47 per cent) continue to be well above industry average and there is an intention to release the next edition of the newsletter by early December.
- The TPB has finalised its Annual Report for 2012-13 and is aiming to table it in Parliament on 28 October 2013.
- The TPB's second Strategic plan, which was released on 14 October 2013, sets out the TPB's direction for the next few years and guides our people and the work we do. The Plan outlines the TPB's objective and linked goals and strategies, as well as service standards and TPB values. The TPB will review and report on progress toward achieving the objective, goals and strategies as contained in the Strategic plan.
- The TPB has continued its activities to proactively engage with registered agents, including through an Outreach program wherein the TPB was encouraged by the response for the Perth and Darwin events earlier this year. The next event is being held in Adelaide from 6 to 8 November 2013, which will entail sessions spread across three locations (CBD, Gawler and Hahndorf). Significant interest has already been received, with approximately 25 per cent of all registered agents in South Australia already confirming their attendance.
- The TPB is considering the submissions received on the TPB's exposure draft on a Board approved course in Australian taxation law for tax (financial) advisers. The TPB has had a meeting with academics to assist the TPB in refining its approach and is looking to reissue the product as a further exposure draft when further details are provided regarding the Regulations.
Board approved course in commercial law for tax agents
- In regard to a Board approved course in commercial law for the purpose of tax agent registration, it was observed that the TPB spent a significant amount of time considering all the submissions and reviewing its position, with the final concluded position being that a course should consist of three units.
- It was confirmed that the TPB is implementing a transitional arrangement for applications made between 1 March 2013 and 30 June 2014 for tax agents who have only completed two units of study in commercial law.
- On 18 September 2013, the TPB published an updated version of its proposed guideline (PG) in relation to the requirements for a Board approved course in commercial law for tax agents (TPB (PG) 02/2010). The updated PG includes information regarding the TPB's transitional approach and the grandfathering of pre-1 March 2010 tax agents.
Professional practice work of the TPB
- It was noted that the TPB has considered the numerous submissions received in regard to the TPB's revised exposure drafts on reasonable care and subsequently developed proposed final versions of information sheets for:
- Code of Professional Conduct – reasonable care to ascertain a client's state of affairs; and
- Code of Professional Conduct – reasonable care to ensure taxation laws are applied correctly.
- The TPB considered the final comments from forum members and noted that it will subsequently publish the final information sheets.
- It was also observed that there is an intention to develop a separate product that provides specific guidance on examples related to larger firm situations, which will be linked within the abovementioned papers in due course as appropriate.
Managing conflicts of interest
- It was also noted that the TPB has considered the submissions received in regard to the TPB's Exposure draft on conflicts of interest TPB information sheet TPB(I) D19/2013: Code of Professional Conduct – managing conflicts of interest.
- It was observed that the TPB intends to finalise this information sheet, subject to any further written submissions from forum members and recognised associations.
Forum members also noted their appreciation of the TPB's consultation process and observed that the products provide greater clarity. The TPB also noted its appreciation for the feedback and input it receives on its professional practice papers.
Future work - Confidentiality
- The TPB's next item of focus for professional practice work will be to provide guidance in the form of an information sheet in regard to subsection 30-10(6) of the Tax Agent Services Act 2009 (TASA) – that is, where an agent has responsibility to ensure that the confidential information provided to the agent by the client is not disclosed to another party without that client's consent.
- In addition to highlighting the need for appropriate consideration of confidentiality of information and robust controls (including where services are provided outside of the office environment), there will also be regard to the growth of outsourcing, offshoring and the use of Cloud in the Australian market for professional tax services. It was also observed that engagement letters have particular relevance in this regard.
Financial advisers update
- To assist the TPB in developing its policy and operational approach to the regulation of financial advisers who provide tax advice, the TPB (and ASIC) has held separate sessions with financial association representatives and financial adviser providers, with the most recent being on 11 September 2013. The purpose of the sessions was to provide an update from the TPB and also seek particular information on positions and any concerns in respect of key areas outlined in a consultation paper the TPB had prepared, including in regard to:
- what is a tax (financial) advice service (including seeking examples of services);
- professional indemnity (PI) insurance;
- continuing professional education (CPE);
- education requirements;
- relevant experience;
- sufficient number; and
- Code of Professional Conduct (Code).
- The TPB noted that it welcomed comments and questions from the forum attendees in regard to issues in the consultation paper (particularly PI insurance and CPE), including receipt of any written submissions. In this regard, it was requested that information be provided to the TPB by 11 November 2013, noting that the next consultation sessions with financial advisers is expected to be held in late November or early December and that there is an expectation the TPB publicly releases documentation regarding its proposed position on key issues by late January or early February.
- It was noted that the TPB also anticipates holding a joint consultative session around late January or early February, bringing together the forum members and the financial association and financial adviser provider representatives.
- The next forum is to be held in Sydney (venue to be determined) and will be held in late January or early February (specific date to be determined). It is also proposed that this will be a joint forum with tax (financial) adviser consultation forum participants.