The Tax Practitioners Board has provided more details on how it will implement the new obligations in Tax Agent Services (Code of Professional Conduct) Determination 2024with many practitioners in smaller firms concerned about their ability to meet the new requirements.

Speaking in a recent webinar, TPB chairman Peter de Cure assured practitioners that the TPB is unlikely to closely scrutinize minor issues associated with areas such as quality management systems unless the practitioner has demonstrated serious misconduct or poor behavior.

De Cure also emphasized that TPB understood the difference between large and small firms.

“Our expectations for the sophistication of the response are much higher uptown and much more pragmatic downtown,” he said.

“For a single practitioner, when it comes to a quality management system, we don’t need to see endless pages and manuals, what we need to see is that they have an adequate way of dealing with the risks involved in their practice, protecting people’s information , ensuring there is a business continuity plan in place should they become incapacitated and ensuring there is adequate information security.

“It won’t be too difficult and if you have any issues then please get in touch with TPB and please give us your constructive feedback on the draft guide.”

The Chairman also sought to reassure practitioners that the TPB will primarily target practitioners who demonstrate poor or egregious behaviour, rather than the population of tax agents and BAS as a whole.

“I really want to emphasize to practitioners that once these provisions are in place and enforceable, we will no longer be running. you go out and knock on your door and try to investigate if you’re complying with each of these specific things,” de Cure said.

De Cure said the TPB had received referrals from the ATO and complaints from the public about bad behavior by some tax agents.

“When we get those complaints or referrals, we go through a triage process. We have a look at their seriousness, we look at the evidence and we look at the overall circumstances,” he said.

“If we think there is a real issue that we need to pursue, then we might go through an investigation. The investigation will focus on truly bad behavior – did the agent steal money from clients, promote tax schemes, or were they simply incompetent in claiming deductions or missing income?

“These are the kinds of matters that are the stuff of bad behavior.”

However, De Cure said that once the TPB has assessed the practitioner’s behaviour, it can also look at how they ran their practice.

“So if you’re not competent, you’re not keeping up with your IP insurance, you’re not doing your CPE, you don’t have a quality management system in place and you’ve made perhaps false and deliberate disclosures. misleading statements, it increases that bigger picture of bad behavior.”

“For practitioners who really behave badly or with egregious behavior, they will be severely punished.”

If there is only a minor issue about which the TPB has received a complaint or referral, the TPB investigation team may deal with it directly with the practitioner, with a follow-up letter or nothing.

“That’s how we’re going to enforce these things, but it’s not like on January 1st we’re going to send inspectors to look at your quality management system.”