The expiration of the grandfathering arrangement that allowed financial planners to apply for a tax agent's licence in line with the new industry rules has the potential of placing a significant number of advisers under ASIC scrutiny.
Under the previous application arrangements covered by the grandfathering provisions, financial planners could apply for a tax agent's licence as part of an association without having to reveal information about tax advice the applicant had provided to clients in the past.
"The problem with that is anybody currently wishing to apply for a tax agent's licence is now exposing themselves to an ASIC investigation, because they cannot categorically state they haven't been providing tax advice," Self Managed Super Funds Professionals' Association of Australia (SPAA) chief executive Andrea Slattery told delegates at the 2011 Financial Services Council Annual Conference.
"Part of the application says they have to get two of their current clients to show they have provided advice in relation to tax," she explained.
To address this concerning situation SPAA has been in consultation with the Tax Practitioners Board and the government to have the grandfathering rules reinstated.
"One of the reasons why we've been working so hard on this issue is we've got 50 per cent of our membership that we'd like to have achieve tax agent status," Slattery said.
