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New Tax Agents’ Regime: Time to act is now!

1 Mar 2010

The legislation to replace the current regulation of tax agents was introduced into the Australian Parliament in 2008 and passed along with separate transitional legislation in 2009. The regime gets underway on 1 March 2010. As with other new or revised regulatory regimes, there are borderlines that have to be established and which are currently uncertain in application. Greenwoods & Freehills latest tax brief discusses when registration is required under the new regime and how the regime may impact unexpectedly on clients.

Taxand's Take

There is the potential for many corporate group service companies, funds management entities, financial advisers and others to have to register as tax agents under the new regime. Though the current rules are problematic, some relief may be in sight following a speech by the Assistant Treasurer but the timeframe is short so action needs to be considered now.

Registration is required if an entity provides a tax agent service to another entity and charges or receives a fee or other reward for the service. A tax agent service consists of providing tax assistance of various kinds such as tax advice, filing a tax return or representing an entity in dealings with the Australian Taxation Office (ATO) in circumstances where the entity which is provided the service can reasonably be expected to rely on its tax content.

For corporate groups the problem this requirement poses is that each company in the group is a separate entity in terms of the definition. Hence if a service company in a group provides services such as preparing tax returns for other companies in the group in return for a fee, it would seem to come within the regime.

Discover the full details of the new regime and how this impacts multinationals in the full tax brief from Taxand Australia.

Your Taxand contact for further queries is:
Andrew Mills
T. +61 2 9225 5966

Taxand's Take Author