Key topics discussed at the BAS Agent Association Group meeting 8 December 2022
Co-chair Assistant Commissioner Kath Anderson welcomed members, confirmed there were no variations to the meeting papers issued on 6 December 2022 and asked that any conflicts of interest be declared; none declared and reminded the group of confidentiality requirements.
Strategic Goal 1 – Protect the high levels of engagement and integrity in the tax, super and registry systems
Tax Practitioners Board
Tax Practitioners Board (TPB) Secretary/Chief Executive Officer Michael O’Neill provided an update from the TPB, which also addressed action items.
Our report provides detail on 460 compliance cases, 3 litigation matters, latest updates on statements of experiences – Tax and BAS Agent strategies and unregistered advisors. We wanted to focus on proposing changes to ta agent services act currently in public consultation.
TPB have expanded the compliance program, with law reform being a large focus
Changes to the Tax Agent Services Act 2009 (TASA 2009) as a result of the James Review are being worked through with Treasury.
Members discussed practitioner reluctance to report peers and that there are processes to protect whistle-blowers.
Strategic Goal 2 – Safeguard the security of the tax, super and registry data and systems
Securing our environment
Assistant Commissioner, Kath Anderson, provided an update on cyber and fraud environment, ATO controls and safeguards and the client agent linking solution update, the key points covered:
- Agents are not immune to identity compromise, so we need to improve up-front linking controls.
- The project is part of a wider program of work aimed at securing the environment.
- Other controls are being considered. Members provided suggestions of additional controls outside of client-agent linking, for example, require more than just the Australian Business Number (ABN) to link.
- While taxpayers who are already in Online services for business should find it relatively simple, those who are not will need to complete multiple steps, which may require more work by agents to assist clients.
- Online services for business may be a fraud risk for unsophisticated users, especially those who are new to Australia.
- We need to shift more controls up front, but we also need to be conscious of the fact that at some time many businesses are likely to be impacted in some way by a cyber breach. Cyber First Aid is therefore very important.
- It is very difficult to have a reverse process, where the agent nominates the link and the client confirms, as the client register has lots of agent details (addresses, phone numbers, email addresses), which would undermine any approval process.
- Does this apply to authorisation through Relationship Authorisation Manager (RAM)? ATO advised that this is not about RAM authorisations, it is about agents linking via Online services for agents or Practice Management Software.
- Concerns regarding the many clients who are not on RAM or Online services for business and the challenge of transitioning them to a system they have never used.
- There is going to be a transition phase, once we are through that hurdle it will be good.
- Members suggested that if someone applies for an ABN then make it a requirement to be on Online services for business.
Senior Director, Katrina Donelan, facilitated a discussion about user scenarios that will form the proposal to provide additional accesses to BAS agents, including:
- other taxation obligations
- superannuation guarantee obligations
- debt obligations
This will improve the efficiency and effectiveness of agents. It will also support the provision of superannuation guarantee services, which is now considered part of BAS services under the TASA 2009.
ATO is seeking to better understand and assist conversation around issues with BAS agent accesses.
- BAS agents require superannuation guarantee charge access, read only access would be sufficient.
- BAS agents want access to view client’s income tax, superannuation guarantee and fringe benefit tax accounts to understand the holistic view of debt, ability to reconcile accounts and verify and provide the right advice to clients.
Senior Director, Tina Ford, provided an update on the lodgment program review, noting that whilst progress has been made across the 3 key streams the main focus has been on engaging around Group 2 and in particular the Online services for agent’s deferral solution.
In relation to due dates and in particular the July–September period, we have not been able to identify any options which meet the principles. We would like to discuss with the BAS Agent Association Group whether there are other options that could be considered.
- This is a positive direction that will bring real benefits to agents.
Strategic Goal 3 – Improve tax performance for clients of tax practitioners
Tax practitioner assistance
Director Felix Manero, provided an update on Tax Practitioner Assistance (TPA) changes implemented in first half of year, including redesigned and reshaped service, giving agents a more contemporary service.
The focus of the next phase is:
- creating a single-entry point for agents
- understanding how to get better integration and awareness out to agents, due to low use of this service in the BAS agent community.
- Members acknowledge this service is needed; however, many people do not know this avenue exists.
- The Tax practitioner assistance form (PDF, 220KB)This link will download a file required to be completed is hard to find and if you do not complete it correctly the form is rejected.
- People do not understand the process and sometimes the questions we have do not fit the format of the form.
- Could there be a button in Online services for agents which automatically links to the client who’s account you are currently in.
Director, Felix Manero, provided an update of Online services for agents lodgment deferral feature.
Since September, significant work has been undertaken, including co-design with representatives from the profession.
Private Beta is the next stage.
Key benefits of the upgraded platform include:
- single entry point
- view of what is currently in progress and the status, for example, approved or rejected
- improved speed and rate of response
- intuitive nature of the function
- automatically presents outstanding lodgment obligations.
- Visibility of deferrals for IT obligations. This is a separate issue that is not being managed through this project.
- Inclusion of reports on forms.
Members were invited to volunteer for the private beta.
Director, Vlad Dugandzic, provided an update on how Taxable Payments Annual Report (TPAR) information is used and the impacts of more frequent TPAR reporting.
TPAR data has proven to be very beneficial for the tax system overall. It is used:
- to provide direct access to the information the ATO holds and assists contractors in declaring all their income
- to support risk identification and understanding across the contractor population through sharing of data with other agencies
- to leverage compliance
- to identify those that engage in shadow economy behaviour and deliberately under-report income, overclaim expenses or operate outside the tax system.
Benefits of more frequent TPAR reporting include:
- earlier opportunity to correct mistakes, identify issues and detect non- compliance
- allows ATO to have a similar system to Single Touch Payroll (STP) enabling us to align the approach for both wages and contracts.
- TPARS do not include all the information required for prefill and a member questioned how the ATO can use this information to prefill when they do not have the complete picture.
- Will the ATO consult actively before expansion? The ATO advised we will consult on any future changes, noting Treasury are the policy makers.
- Members would like some data on the impacts and benefits as there has been no reporting since year one.
Senior Director, David Baker, provided an update on What’s new in Online services for agents and the scheduled maintenance dates for the 2023 calendar year.
The ATO is addressing the issue of tax practitioners bumping off BAS agents, the ATO is going to remove tax practitioners’ ability to remove BAS agents.
Members appreciated that this issue is being addressed.
Strategic Goal 4 – Increase trust and confidence in the tax, super and registry systems
Draft 2030 Tax practitioner experience strategy
Senior Director, Katrina Donelan presented the latest version of the tax practitioner strategy, noting that the strategy is still being refined as a result of internal and external consultation.
The next layer of the strategy, which maps initiatives to the strategic goals and strategic objectives will be important.
- Members commented favourably on the ‘2030 tax practitioners experience strategy’
- Consider more delineation between Tax and BAS agents as different strategies or initiative will result in different experiences.
- The strategy needs to be considerate and acknowledge the current environment and challenges being experienced by Tax and BAS agents.
- Reasonable care is in the TASA 2009 and is the TPB’s responsibility not the ATO’s. However, it was acknowledged that the strategy is a joint strategy and will include responsibilities of stakeholders other than the ATO, as well as shared responsibilities. This will be clearer in the next layer of the strategy.
Strategic Goal 5 – Empower tax practitioners to optimise integrity and performance of the tax, super and registry systems.
STP activity statement enhancements
Project Manager, Tiffany Waters, provided an overview of the STP activity statement enhancement changes to members.
Senior Director, Rob Hayes, provided members with an update on director ID, summarising the work done so far, including that the first stage of the Modernising Business Register has been delivered, incorporating director ID.
There have been many directors come forward who did not know they were a director or have been appointed without their consent or have had their identity stolen.
Agents do not know if their client has done it because there is nowhere to check, only the individual can check.
Co-chairs Kath Anderson and Kerrie Jarius facilitated a group discussion for members to identify items that are impacting the profession.
Kerrie provided an opportunity for members to share any trends and to provide relevant information on current issues affecting the profession.
- Understanding the parameters around payment plans and the possibilities of auto-finalising payment plans when the balance gets to zero.
- A script for what debt staff will ask for when agents ring about payment plans.
- Guidance on steps to insolvency, to assist their clients.
- Advice on what to do to avoid long wait times on debt queues. Note – ATO has subsequently advised that if an agent rings the payment plan number and the plan is not approved, they may drop into the general queues, which have long wait times. The best thing to do is to hang up and call back in on the agent line, which has a much shorter wait time.
Further insight raised on the general agent environment include:
- Businesses are making less money; their businesses are doing it tough.
- Uncertainty regarding changes initiated by the ATO creating additional steps without the ability to charge more.
- Staffing issues including large retirement numbers in the industry, creating fatigue resulting in inability to meet basic businesses requirements.
- With rising costs, some clients are no longer using the services of bookkeepers.
Strategic Goal 6 – Improve small business performance and the level playing field
Improve small business performance
The ATO provided an overview of the small business performance initiative. Key points include:
- In September 2022, the Commissioner of Taxation gave the closing keynote speech at Xerocon in Sydney, which was positioned around the ATO's recently refreshed ATO Digital Strategy and brought to life its design principles.
- In doing so, the Commissioner celebrated some of the ATO's digital and data initiatives and imagined what a future digital tax system might look like 'where tax just happens'.
- The Commissioner emphasised the principle of leveraging natural systems and spoke of our 'North Star', which is to align with the OECD's Tax Administration 3.0, where reporting, payment and real-time compliance checks coincide with a taxable event.
- He acknowledged the important role of tax professionals, that tax assurance is a combination of people and processes enabled by technology, rather than technology solving everything.
- Members like the concept, but still see issue with the assurance of the data and complexities, noting agents may still need to provide this assurance by reviewing the data.
- Concerns with getting engagement from the small business community to trust the ATO and accounting software to get it right.
- New learning opportunity for agents and levels out the playing field with everyone in the industry.
- BAS agents identify with being a BAS agent. What issues will arise if there is no longer a BAS? This will need to be worked through.
- The concept of assurance needs further exploration. Software companies will not want to have an assuror role. Will businesses want to pay for an assurance role?
- Members agreed that BAS agents value is not just about completing the form, but it is providing professional advice and ensuring the data integrity.
- An out of session conversation will occur in the new year. Members were invited to provide other feedback to the secretariat.
Thank you to the secretariat and to Sue Hassiotis who is moving onto the Tax Practitioner Stewardship Group.Key topics discussed at the BAS Agent Association Group meeting 8 December 2022