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TPB Financial advisers forum report – 13 July 2016

TPB Financial advisers forum report – 13 July 2016

On Wednesday 13 July 2016, Ian Taylor (Chair) and Tax Practitioners Board (TPB) colleagues held a TPB Financial adviser forum in Sydney with representatives from associations that have an interest in financial planning.

The key points discussed at the forum are summarised below. This brief report is intended only to provide an overview of the issues that were discussed and does not represent the final views of the TPB, nor is it intended as minutes of the forum.

Update from the TPB

Registrations update

  •  As at the end of June 2016, there were 75,436 registered practitioners comprising 41,227 tax agents, 14,715 BAS agents and 19,494 tax (financial) advisers (including 1,071 Australian financial services (AFS) licensees, 18,314 authorised representatives and 109 other representatives).
  • As expected, the number of registered practitioners has remained relatively steady (were 75,489 registered practitioners as at the end of February 2016), with a nominal number of tax (financial) adviser registration applications received since the transitional and standard registration options commenced on 1 January 2016. In particular, 501 tax (financial) adviser applications had been received as at the end of June (comprising 311 transitional and 190 standard registration applications) and 370 of these applications had been processed (229 registered under the transitional option and 141 registered under the standard option).
  • The TPB is continuing activity to raise awareness and educate practitioners about what they need to consider now to be ready to meet registration requirements when renewals are due progressively from July 2017. These activities include:
  • providing webinars, including a rolling schedule of dedicated webinars entitled ‘Getting ready to renew your tax (financial) adviser registration’. These particular webinars are designed for AFS licensees and authorised representatives who are already registered with the TPB. Relevant details are available from a dedicated link on the TPB’s home page at www.tpb.gov.au  
    • scheduling further face-to-face outreach activity
    • providing a simple online decision tree tool so that registered tax (financial) advisers and prospective applicants can self-assess if they will meet the qualifications and experience requirements under the standard registration option
    • reviewing and updating relevant website information (for example, updating the qualification lists of courses and units that in part or in full meet the requirements for Board approved courses in Australian taxation law and Commercial law).
  • It was also noted that the TPB has a qualifications advice service (relevant queries can be sent to the TPB) and that there are specific information sheets providing guidance on the Board’s approach to ‘sufficient experience’ and ‘relevant experience’:
    • TPB Information sheet TPB(I) 24/2015: Relevant experience for tax (financial) advisers – provides information to assist individuals to understand the TPB's approach to the meaning of 'relevant experience' for the purpose of registration as a tax (financial) adviser under the standard application option
    •  TPB Information sheet TPB(I) 25/2015: Applying for registration during the transitional period: Sufficient experience to be able to provide tax (financial) advice services to a competent standard – provides information to explain the TPB’s view on what is meant by ‘sufficient experience’ and ‘competent standard’ in the context of registering in the transitional period.
  • It was also noted that each application for registration will be considered on a case-by-case basis having regard to the applicant’s facts and circumstances. Further, the TPB is building up its knowledge base (and reviewing website guidance as appropriate) as it continues to assess and process registration applications.
  • It was also reiterated that processing times for future applications may be impacted by the large influx of standard registration renewal applications expected from July 2017 (depending on when entities notified).

Registered symbol

  • It was observed that the TPB has implemented extension of the registered tax practitioner symbol to tax (financial) advisers who have registered under the standard option, including advising of availability to the small group that had already registered under the standard option.

Annual declarations for registered practitioners

  • It was confirmed that the annual declaration process will be operative for tax (financial) advisers from early 2017 (for those who renew registration and for those already registered under the standard and transitional options).
  • It was noted that over 20,000 registered tax and BAS agents have submitted an annual declaration since January 2016 to demonstrate they are meeting their ongoing registration obligations (requirements in relation to professional indemnity insurance, continuing professional education (also known as CPD), meeting own personal tax obligations, and being fit and proper).
  • The declarations are due on the anniversary of the practitioner’s renewal date (other than in the year that registration needs to be renewed) and are a formal request from the TPB (a failure to respond could result in the TPB imposing a sanction pursuant to finding that there has been a breach of the Code of Professional Conduct in the Tax Agent Services Act 2009 (TASA)). The TPB is continuing to receive a good response rate.

Communication activities

  • The TPB is continuing with a broad base approach to Outreach involving a combination of webinars, attendance at speaking events, and face-to-face events. It was noted that a number of face-to-face events are being scheduled later this year, including events in Sydney (18 and 19 October) and Melbourne (25 and 26 October), with relevant details to be made available from the TPB home page.
  • Webinars continue to be well received, with a good level of attendance and interaction. There will continue to be a rolling schedule and ongoing development of webinars pursuant to feedback (including suggestions for topics), with details about upcoming webinars available on the TPB’s home page at www.tpb.gov.au
  • The TPB appreciates association and AFS licensee support in communicating key messages (including the importance of timely consideration of registration requirements and awareness of the consequences when ceasing to meet requirements) and also welcomes opportunities to participate in association conferences and speaking events on relevant topics. The TPB also welcomes any further suggestions on how to best reach those who need to renew registration, and those employee representatives who may need to register (for the purpose of satisfying the sufficient number requirement for company and partnership practitioners registered with the TPB).

Policy matters

Cloud computing and the Code of Professional Conduct

  • It was noted that the Board considered all the submissions received in relation to Exposure draft Information sheet TPB(I) D30/2015 Cloud computing and the Code of Professional Conduct and resolved to revise the style and content of the document and refer back to the Consultative forum and Financial adviser forum for further guidance and feedback.
  • In particular, it was noted that the revised Practice Note document employs a less technical and more concise educative format that raises awareness of relevant considerations when entering into cloud arrangements (instead of being a technical information sheet).
  • The forum provided some suggestions in relation to the revised document for the purpose of providing further clarity. It was confirmed that this feedback would be referred back to the Board for consideration prior to publishing an updated Exposure draft Practice Note (providing for a 45 day comment period), with subsequent referral back to the forum as appropriate prior to finalisation of the document.

Code of professional conduct guidance for tax (financial) advisers

  • It was confirmed that the TPB is considering submissions in relation to the following Exposure draft information sheets, prior to determining next steps:
    • Exposure draft TPB(I) D32/2016 Code of Professional Conduct – Acting lawfully in the best interests of clients for tax (financial) advisers (Code item 4)
    • Exposure draft TPB(I) D35/2016 Code of Professional Conduct – Having adequate arrangements for managing conflicts of interest for tax (financial) advisers (Code item 5)
    • Exposure draft TPB(I) D31/2015 Code of Professional Conduct – Confidentiality of client information for tax (financial) advisers (Code item 6) (revised under embargo draft, incorporating minor changes for the purpose of providing further clarity)
    • Exposure draft TPB(I) D33/2016 Code of Professional Conduct – Reasonable care to ascertain a client’s state of affairs for tax (financial) advisers (Code item 9)
    • Exposure draft TPB(I) D34/2016 Code of Professional Conduct – Reasonable care to ensure taxation laws are applied correctly for tax (financial) advisers (Code item 10).
  • The forum provided some suggestions for the purpose of providing further clarity and it was confirmed that this feedback would be referred back to the Board for consideration prior to determining next steps.

Legislative instrument

  • It was noted that the TPB is currently scoping out information to provide for a potential legislative instrument allowing certain services to be included in the definition of a tax (financial) advice service in relation to interaction with the Australian Taxation Office.
  • It was also noted that there will be extensive stakeholder consultation and that the Consultative forum and Financial adviser forum will be advised of developments and involved in further consultation in due course.

Next meeting

  • The Chair thanked the forum members for their attendance and continuing feedback and guidance.
  • It was also noted that the next proposed meeting will be held on 10 November in Sydney.

Last modified: 12 October 2017