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Tax practitioner compliance actions are set to rise over the next 12 months as the Tax Practitioners Board and the ATO look to further develop a joint compliance program.
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TPB eyes sanction spike through joint ATO compliance program
20 October 2020
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The joint compliance program, which was initiated last year, has already seen the ATO refer 245 matters to the TPB in 2019–20, a 25 per cent increase in referrals from the previous year.
The heightened compliance work contributed to the 965 sanctions handed out by the TPB over the last financial year, a 32 per cent increase from 2018–19.
The TPB also made the decision to terminate the registrations of over 170 practitioners who collectively represented 60,000 clients, a 129 per cent spike in terminations from the year before.
TPB chair Ian Klug said the board expects a further increase in cases and sanctions in 2020–21 as it further refines its joint compliance program with the ATO and enhances its data analytics capabilities.
“The JCP [joint compliance program] relies on the ATO tax practitioner risk model and is an end-to-end strategy covering detection, compliance enforcement, sanction (including through litigation) and influencing behaviours,” Mr Klug said in the TPB’s latest annual report.
“Next year, we will continue to pursue the highest risk practitioners through the JCP, as well as progress our normal investigations through our regular compliance program and assure our trustworthy practitioners that we are working hard to level the playing field for those who provide sound, intelligent and effective tax advice to their clients.”
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The joint compliance program will also specifically target high-risk practitioners associated with schemes that seek to undermine the government’s COVID-19 stimulus measures, with one Sydney agent recently sanctioned for attempting to fraudulently claim the cash flow boost.
The TPB is also currently undertaking 40 investigations into unregistered practitioners after receiving over 200 complaints over the last year.
While it looks to seek court-imposed sanctions for such unregistered practitioners, the regulator noted that the independent review of the TPB may provide it with new compliance actions to deal with unregistered agent activity.
The review was completed in October last year but has yet to be released by the government.
As of 30 June 2020, the total registered tax practitioner population was 78,181, composed of 43,253 tax agents, 16,160 BAS agents and 18,768 tax (financial) advisers.
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