ASIC said accountants should start preparing their applications and start any required training now should they wish to continue to provide such services after 30 June 2016. Accountants should also contact their professional membership associations (for example, Chartered Accountants ANZ, CPA Australia, Institute of Public Accountants). ASIC noted that after 30 June 2016, any accountant found to be providing unlicensed advice risks regulatory action. Providing unlicensed financial services is a criminal offence.
ASIC Deputy Chairman Peter Kell said that where an application is in good order ASIC can assess the application within 4 weeks, but if further details are required because the information provided is insufficient this will take longer. ASIC warned that accountants who do not lodge applications which meet ASIC's requirements by 1 March 2016 run a significant risk their application will not be assessed before 30 June 2016. ASIC said there was no proposal to extend the 30 June 2016 cut-off date as accountants have been able to apply for this type of licence since 1 July 2013. "Our message to accountants is clear: don't be complacent, you need to act now," said Mr Kell.
Some key points from ASIC:
The SMSF Association said that accountants who want to give financial planning and superannuation advice after 1 July 2016 need to start the process now. The required training typically takes from a minimum of 6 months up to 2 years, said Liz Ward, Head of Education Services at the SMSF Association, and Kath Bowler, CEO of Licensing for Accountants (an independent firm dedicated to guiding accountants through the licensing maze).
Ward and Bowler said that giving advice on setting up an SMSF from 1 July 2016 will be no different to advising on contributions, LRBAs and pensions (including transition to retirement pensions), and will require a full or limited AFS licence. Accountants who believe that they can remain exempt on the basis that they only give tax advice need to consider if they are truly just giving "tax advice". The SMSF Association warns advisers that if they are taking other factors into account (such as when they can make contributions, rollover benefits, the fund's investments or commencing an income stream), then they will need a licence.
Likewise, tax advisers will need to provide a disclaimer noting that they are only providing tax advice, and clients must seek advice from a licensed financial adviser. Accordingly, accountants who aren't licensed may be holding back their business opportunities, as well as potentially losing financial planning and superannuation revenue and clients to practitioners who are licensed, the SMSF Association said. (Source: SMSF Association media release, 26 August 2016.)
You can read earlier ClearLaw articles on a wide range of SMSF topics.
Leigh is a partner in the Maddocks Tax & Revenue team.
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