FPA defends professional associations tax adviser registrations

The Financial Planning Association (FPA) has signalled its strong opposition to Government moves to remove the professional associations registration with respect to tax (financial) advisers.

The FPA has made its position clear in its response to the regulations around the Better Advice legislation which passed the Parliament last week, stating that the approach proposed by the Government will generate inconsistent options for financial advisers.

“With the proposed removal of the membership of a professional association registration option, financial advisers required to re-register with the TPB under the new tax agent provider of tax (financial) services conditional membership category, must meet the tax and commercial law course requirements set in item 33 of the draft Regulations,” the FPA said.

“However, financial advisers who will be required to re-register with the TPB post 1 January 2022, may be currently registered under option 304 – membership of a professional association – which includes an exemption from the TPB tax and commercial law course requirements.”

“… the FPA opposes the removal of the membership of a professional body registration option for financial advisers. Should the Government persist with the implementation of inconsistent registration options for this class of tax practitioners, this will result in a significant change in the registration requirements for affected individuals, which should attract appropriate transitional arrangements to allow providers to undertake any necessary education. The 12 months proposed under item 204 of item 33 of the draft Regulations, provides no flexibility and would place significant pressure on individuals while they continue to service the needs of their clients.”

The FPA said there was also a lack of clarity around the expiry of existing registered tax (financial) advisers and the duration of their re-registration as a tax agent providing tax (financial) advice services.

“For example, if a tax (financial) adviser renews their registration on 1 October 2021 for a 3 year period, and TPB accepts their application to register as a tax agent providing tax (financial) advice services on 1 July 2022, would the following renewal be due by 1 July 2025?”

The FPA has called for greater clarity around transitional arrangement for existing tax (financial) advisers who are not relevant providers and the implementation of significant transitional arrangements in the event the Government removes the membership of a professional body registration option.