Up the education ante for tax (financial) advisers, says IPA
At a time when the public is seeking the best financial planning and tax advice, it is imperative to ensure the new breed of tax (financial) advisers are up to the task, according to the Institute of Public Accountants (IPA).
In its submission to the Tax Practitioners Board (TPB) on exposure draft, “A course in Australian taxation law” that is approved by the Board for tax (financial) advisers, the IPA has stated that a one semester unit is inadequate.
“The provision of tax advice is inextricably connected with the provision of financial advice and therefore establishing appropriate education requirements including relevant education in Australian tax law is essential,” said IPA chief executive officer, Andrew Conway.
“Once a tax (financial) adviser is registered with the TPB, the adviser will be permitted to give tax advice covering any tax matter, provided it is in the course of providing financial advice. We therefore believe the duration of a course in Australian tax law should be of sufficient breadth to equip a tax (financial) adviser to adequately advise the public on tax issues.
“Simply put, the proposal of a one semester unit in tax law is inadequate unless the scope of advice is significantly restricted in line with the level of training.
“There needs to be a level playing field in the advice arena to ensure the best interest duty is being implemented and the public interest is being served. There is little difference in the scope of advice that a tax (financial) adviser can provide compared to a tax agent so we believe they should have a similar level of Australian tax knowledge as required by tax agents.
“Once a financial planner registers with the TPB they will no longer be able to use the disclaimer that any tax advice provided as part of providing financial advice cannot be relied upon.
“Put simply, financial planners will be accountable for any tax advice provided and can no longer hide behind the protection afforded by using the disclaimer.
“We are already concerned that financial planners who are able to register due to their professional association membership will not be required to satisfy any tax or commercial law education requirements.
“There should be a level playing field but there isn’t; in the new regime, accountants have to do their RG146 with no free kicks in education requirements,” said Mr Conway.