The Financial Planning Association (FPA) has welcomed the Australian Government’s decision to extend the exemption granted to financial advisers who also work as tax agents.
The exemption from the taxation-agent services regime will now run until 30 June 2013.
The FPA had been lobbying Assistant Treasurer David Bradbury for a six-to-12-month extension period and a three-year transition period to ensure the continuing education of members.
While details of any transition period have not been finalised, it is unlikely that any further extension to the 30 June 2013 date will be considered.
This deadline will bring taxation advice, provided in the context of financial-product advice, within the scope of the Tax Agent Services Act 2009.
The decision to grant an extension followed consultation with representatives from the financial planning, tax and accounting bodies, the Tax Practitioners Board and the Australian Securities and Investments Commission (ASIC).
“This will allow for the details of the regulatory model to be settled and ensure resolution of implementation issues associated with bringing financial advice under the scope of the tax-agent services regime,” said Bradbury.
“The new regulatory arrangements will focus on the principles of consumer protection and the delivery of quality taxation advice by financial advisers who offer this as part of their financial-product advice services.”
A spokesperson for the FPA confirmed that the association had met with Bradbury last week (April 26) and given him “a letter making a formal request for an extension due to unresolved aspects of the regime, such as the registration process and obligations, the education competency requirements and the transition period”.
However, while he conceded that the Treasury announcement had arrived surprisingly quickly, a great deal of consultation work must still be undertaken by ASIC and the Tax Practitioners Board before all the details are resolved.
“With FoFA and MySuper commencing from July 1, 2013, it made sense to align this to allow the profession to more efficiently and effectively comply with the respective changes,” the FPA said in a statement.
This announcement is very bad.
It is a well known fact that a great many Financial Planners really have no knowledge of Income Tax and that a great many Financial Plans are made with Tax Consequences. Many Planners are proviidng Tax Advice without the correct licensing and this is bad. Accountants cannot give financial advice without been licenced.
It is time that a level playing field existed.
Make all Planners have a limited Tax Licence now and before the end of June 2012.
As a result of many planners not having a tax licence the clients are been disadvantaged in many circumstances.