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The IPA has used its pre-Budget submission to call for the extension of legal privilege to tax advice provided by accountants and tax agents.
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IPA calls for legal privilege for tax advice
25 February 2015
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The institute has called for legal privilege to be extended to registered tax agents who are members of professional accounting associations on the basis that members of professional accounting bodies are qualified accountants who have undertaken further studies, hold a practising certificate and are held to higher professional and ethical standards than non-members.
“Australian taxation law is complex, and the self-assessment system requires taxpayers to have a good understanding of their rights and obligations before they can make an assessment of their tax liability. This justifies why the tax legislation makes allowance for accountants to give legal advice on taxation law,” the submission said.
“Consumers seeking independent and objective taxation advice must have access to legal protections and safeguards irrespective of whether they seek the advice from a lawyer or from an accountant.”
While the ATO does have a non-statutory administrative arrangement in place that provides a form of legal protection, the IPA said this protection is narrow, restrictive and inadequate.
“Extending legal privilege to tax advice would give the accountant’s concession legislative force. A recent case confirmed that the accountant’s concession cannot be claimed over documents that have come into possession of persons other than the taxpayer or adviser from which they are sought by the ATO,” the submission stated.
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