Draft legislation was recently released (in respect of which submissions closed on 8 March 2013) about amending the Tax Agent Services Act 2009 (TASA) to bring entities that give tax advice in the course of advising on one or more financial products within the regulatory regime administered by the Tax Practitioners Board. This was proposed to commence on 1 July 2013. Submissions on the draft conflicted on whether the 1 July 2013 start date should stay.
The Financial Planning Association says that only 3 months away from the existing deferral arrangements ending, there is still no clarity on the exact requirements and obligations for financial planners in respect to complying with the Tax Agent Services Act. Further, the FPA says the only possible sitting days to have this legislation passed by Parliament fall in June 2013, leaving no room for error and no time for industry to implement. Should this measure proceed, the Bill is likely to only be passed by Parliament in late June and there are still regulations and guidance documents required by both the TPB and ASIC that would need to be released.
The FPA strongly recommended that the Government consider extending the deferral arrangement of TASA to financial planners for another 6 to 12 months. The AFA also recommended a 6 to 12 month deferral, especially as the compulsory commencement of the FoFA rules is also to start on 1 July 2013. The AFA considers that a delay in the start-date does not need to mean that the commencement of the full application on 30 June 2016 needs to be deferred. Either the notification phase or both transitional phases could be reduced.
The Tax Institute on the other hand, said the start date should stay. It said that, initially, an exemption for AFSL holders providing financial product advice was provided until 30 June 2011 while consideration was given to how AFSL holders in this position would be regarded under Tax Agent Services regime. Subsequently, the expiry of the exemption was extended to 30 June 2013. On the basis that the regime is to apply to AFSL holders who provide tax advice from 1 July 2013, to ensure a timely transition, the Institute argues that no further extension should be provided.
Time is clearly short for the progress of the planned changes, and the Budget sittings of Parliament are sure to an extremely busy time.
[LTN 57, 25/3/13]