The Tax Practitioners Board (TPB) recently announced further details about its new compliance program with surprisingly little fanfare. The devil really is in the detail, including the TPB targeting accountants for tax planning that it says is not in the spirit of the law.
In late July, the TPB published its corporate plan saying it will target accountants “who are driving non-compliance, including tax avoidance and evasion, profit shifting by large multinationals, and shadow economy activities”. It will also “deliver improved tax compliance and raise industry standards”.
There’s no doubt that the TPB must apply its resources to stamp out unlawful activity. However, its reference to targeting accountants who engage in ‘tax avoidance’ is somewhat troubling. Tax avoidance is not unlawful. That has been made clear by the courts for decades. The difficulty however is that positions taken by accountants when they are tax planning may not always be within the spirit of the law, whatever that may mean.
Understandably, there is real concern amongst accountants, particularly the smaller players, that they will bear the brunt of the regulator’s more assertive posture because of higher profile failings in the accounting profession. In this regard, the TPB has stated publicly that it will review over 2,700 complaints and complete over 850 investigations this year alone. Last year, the TPB received 1,296 complaints and reviewed over 2,000 cases.
We’ve prepared an investigations checklist covering over a dozen areas that are regularly examined in these cases. Contact us for a copy so you can test your practice against the TPB’s targets.
HWL Ebsworth’s national tax group has extensive experience acting for accountants under investigation by the TPB and the professional bodies. We’ve acted in cases involving stolen monies, client complaints, audits of accountant’s personal tax affairs, conflicts of interest, outstanding tax obligations, ‘aggressive tax planning’ and dishonestly ‘ticking the box’.
This article was written by Vincent Licciardi, Partner, Anne Fernando, Associate, and Alissa Lee, Associate.