• BAS Agent Association Group Minutes, November 2014

    Meeting details

    Venue

    Meeting held via videoconference at ATO sites:

    Brisbane
    Moonee Ponds
    National Office
    Sydney

    Date

    27 November 2014

    Start

    9.30am

    Finish

    12.40pm

    Chair

    Colin Walker

    Secretariat

    Tricia Walsh

    Contact Phone

    07 3149 5768

    Attendee list

    Colin Walker
    Assistant Commissioner

    ATO

    Joyce Correnza
    Director

    ATO

    Debra Anderson
    Principal, Legally BAS

    BAS Agent

    Tony Austin
    Membership Association Representative

    First Class Financial Group

    John Birse
    CEO and National Divisional Franchisor

    Jim’s Bookkeeping

    Keith Clissold
    Professional Association Representative

    Association of Taxation and Management Accountants and Association of Certified Bookkeepers

    Kelly Day
    Principal, Accounts by Day

    BAS Agent

    Kerri Giles
    Principal, Kwik Biz Solutions

    BAS Agent

    Rowena Hand
    Principal, Books and BAS

    BAS Agent

    Martine Joly
    Professional Association Representative

    Chartered Accountants Australia and New Zealand

    Stuart Norman
    Chief Executive Officer

    Association of Accounting Technicians

    Russell Smith
    Principal, Caruss Consultants

    BAS Agent and Tax Practitioners Board member

    Guest presenters

    David Baker
    Director
    Issues and Channel Management

    Tax Practitioner, Lodgment Strategy and Compliance Support

    Tom Byrnes
    Assistant Commissioner
    Future Client Experience

    Private Groups and High Wealth Individuals

    Lekie Johnstone
    Assistant Director
    Tax Practitioner and Lodgment Strategy

    Tax Practitioner, Lodgment Strategy and Compliance Support

    Jonathon Thorpe
    Acting Assistant Commissioner
    Coordination Delivery

    Service Delivery

    Apologies

    Matthew Addison
    Executive Director

    Institute of Certified Bookkeepers

    Maria Benardis
    Professional Association Representative

    Association of Taxation and Management Accountants and Association of Certified Bookkeepers

    Tony Greco
    Professional Association Representative

    Institute of Public Accountants

    Peter Thorp
    Professional Association Representative

    Australian Bookkeepers Association Ltd

    Secretariat

    Tricia Walsh

    Tax Practitioner, Lodgment Strategy and Compliance Support

    Disclaimer – BASAAG agendas, minutes and related papers are not binding on the ATO or any of the other bodies referred to in these papers. The responses contained in this agenda are the preliminary responses of the ATO based on the agenda items supplied. These papers reflect the position prior to discussion in the meeting and readers should note that the position on any issue may subsequently change.

    Agenda Item 1: Welcome and introductions

    Action item – open

    Reference

    BASAAG 0412/01

    Agenda Topic

    Lodgment Program

    Action item

    BAS Agents to be more involved in consultation leading to the further implementation of the 85% lodgment program framework

    Responsibility

    Assistant Commissioner Colin Walker

    Update

    The ATO is continuing to monitor and refine the lodgment program. Further consultation will be undertaken during this process.

    Attendance

    Apologies

    • Matthew Addison, Institute of Certified Bookkeepers
    • Maria Benardis, Association of Taxation and Management Accountants and Association of Certified Bookkeepers
    • Tony Greco, Institute of Public Accountants
    • Peter Thorp, Australian Bookkeepers Network

    Guests

    • Keith Clissold, Association of Taxation and Management Accountants and Association of Certified Bookkeepers – proxy for Maria Benardis
    • Rick Van Dyk, General Manager, Institute of Certified Bookkeepers - proxy for Matthew Addison

    Agenda Item 2: Debt arrangements and agents’ lodgment extensions

    Assistant Director Tax Practitioner Lodgment Strategy, Lekie Johnstone confirmed to members the position when agents lodge applications for lodgment extensions for clients with existing debt arrangements in place.

    The Lodgment Program concessions for quarterly activity statements for registered agents are still available, regardless of whether their client is currently in a payment arrangement for outstanding debt.

    Registered agents will be directed by contact centre operatives to use the portal if they are seeking a lodgment deferral for their clients. A new lodgment deferral form has been developed and is available on the website for use by both BAS and tax agents – Lodgment deferrals – for registered agents.

    The new form will streamline the process for agents making requests and for staff processing deferral requests. It was also noted, that when requesting a lodgment deferral for the Quarterly Activity Statements agents should be seeking additional time beyond the Lodgment Program concession, for example for quarter 1 the Lodgment Program due date is 25 November 2014.

    Agenda Item 3: Single Touch Payroll

    Assistant Commissioner Coordination Delivery, Jonathon Thorpe facilitated a more detailed discussion on Single Touch Payroll.

    The ATO has been promoting digital take up across a range of systems with a clear and efficient driver to move to digital with resulting cost savings for the community. The ATO is continuing to reduce available content on the website while also making it easier to find. EFT has been mandated across the board; myGov is mandatory for e-tax and myTax; and three million taxpayers migrated across this TaxTime.

    Single Touch Payroll leverages the natural payroll cycles to fulfil all employer reporting and payment obligations to various government agencies and other intermediaries. Using payroll software, an employer could pay and report their tax and superannuation obligations in a single transaction every payroll event.

    Australia currently has the slowest rate worldwide between reporting and collection of PAYGW. The use of Single Touch payroll would reduce this difference significantly as both could be done in a single transaction as part of a natural payroll event.

    We will continue to undertake consultation to shape the detail design of Single Touch Payroll. This will include input from BAS Agents, business and other elements of the community.

    Agenda Item 4: Update on open forums

    The Chair provided members with an overview of the recent series of Open Forums conducted as part of the Commissioner’s vision of enhanced consultation with tax practitioners.

    The ATO has expanded the program of Open forums to include some metropolitan areas. The intent of Open forums is to provide an opportunity for practitioners to have an open dialogue with the ATO and for the ATO to hear about matters important to practitioners. In a typical forum, the ATO will talk with tax practitioners about:

    • support and services for registered agents
    • operating in the digital age
    • lodgment program
    • support for individuals and businesses with a tax debt
    • cash and hidden economy
    • SuperStream
    • Tax Practitioners Board.

    The overall response to the open forums has been positive with several events oversubscribed.

    The ATO is currently in the process of collating the questions and issues raised at all the open forums. Some general themes arising consistently include:

    Lodgment program

    • Clarification on how we calculate the on time lodgment (and whether an agent meets the 85% benchmark)
    • Client deletions not working (including requests for bulk deletion facility to be available)
    • The impact on lodgment performance of taking on new clients with multiple years outstanding
    • Perception that deferrals are generally disallowed

    Debt

    • Why we don’t intervene earlier to optimise the client’s ability to pay (rather than have the debt escalate out of control)
    • Mercantile agents, particularly the perception that they misrepresent themselves as being from the ATO, and other proof of identity matters
    • Inconsistent treatment of clients entering (or re-entering) payment arrangements
    • Confusion between re-raised and written off debts

    Cash economy

    • More detail on the extent and reasons why a client is outside the small business benchmarks
    • Mixed businesses (and the restrictions of the ANZSIC coding) often lead to businesses being incorrectly classified as outside the benchmarks

    Electronic activity statements

    • How to revert clients back to paper activity statements (including how to do this in bulk)

    We have also consulted on aspects of Reinventing the ATO following a number of the forums.

    An evaluation and review on the open forums will be conducted after the final forums are completed in December 2014.

    Agenda Item 5: BAS Agent client story

    Assistant Commissioner Future Client Experience, Tom Byrnes reviewed joined the meeting to further discuss the BAS Agent Client Story, based on the experience of BAS Agent Ita McKenzie.

    The BAS Agent Client Story has been developed following consultation with members of this group at the meeting on 4 September 2014 incorporating practical comment and information contributing to the creation of a future experience for BAS Agents.

    Members provided further feedback to assist in the refinement of the document and an amended version has since been distributed. The amended version will appear in the complete Reinvention Blueprint which will be released early next year. The timing and logistics of the release are being worked through now – no decisions have been made.

    Agenda Item 6: Tax Practitioners Board Report

    The following report was tabled at the meeting:

    1. Board activity

    TPB Outreach

    The TPB are currently reviewing the outreach program and are looking at new approaches to meet the changing goals of face to face outreach. In particular, we are looking at trial of webinars, focussing on more remote locations such as Hobart, Far North Queensland and Darwin.

    Annual Report

    The TPB’s Annual Report 2013–14 was tabled in Parliament on Wednesday 29 October 2014.

    This year’s report describes how we carried out our registrations function and provided guidance to registered tax practitioners to assist them to understand and meet their obligations. The report also outlines the work we have undertaken to prepare and consult with the financial services profession for the implementation of the new tax (financial) adviser regulatory arrangements, which commenced on 1 July 2014.

    Summary of penalties, sanctions and terminations

    The third edition of the summary of penalties, sanction and terminationsExternal Link has been published on the TPB website. It outlines the most recent compliance outcomes and decisions by the TPB’s Conduct Committee, and cases that have been heard by the Administrative Appeals Tribunal (AAT) and the Federal Court.

    The compliance case studies demonstrate how we respond to and investigate complaints. It shows how we consider which action to take in particular cases to ensure that penalties and sanctions are commensurate with the seriousness of the breach of the law.

    The TPB compliance strategy is based on providing strong support for tax practitioners who are responsible and who comply with the Code of Professional Conduct and other legislative requirements, while taking firm action in relation to those agents who do not comply

    Speaking events

    Ian Taylor presented to BAS and tax agents at the Australian Bookkeepers Network Bi-Annual Conference on 17 October. Ian spoke about the role of the TPB as well as the obligations of registered agents.

    The TPB are also participating in the ATO’s Open Forums across NSW, WA and Victoria. The forums provided an opportunity for the TPB to talk to tax and BAS agents about the registered agent symbol, tax (financial) advisers, renewals, reasonable care and confidentiality.

    Maria Benardis resigns from the Board

    Maria Benardis has resigned as a Tax Practitioners Board member for family reasons. On behalf of the Board, Ian Taylor thanked Maria for her contribution to the TPB and wished her all the best in the future.

    2. Registrations

    Applications on hand to be processed at 31 October 2014

    Applications on hand

    Number

    TA new registration applications

    337

    BAS new registration applications

    323

    TA renewal applications

    561

    BAS renewal applications

    309

    Total

    1530

    Current turnaround times – July 2014

    Type of application

    Current turnaround times (days) from the date application is complete and accurate

    Registering as a tax agent

    27

    Registering as a BAS new agent

    24

    Renewing a tax agent registration

    20

    Renewing a BAS agent registration

    18

    While our turnaround times are currently below our service standards of 30 days, increased registration work, reduction in staff and a reduced budget may impact on our service standards. However, the TPB are looking at ways to make the process more streamlined and to make efficiency gains.

    Tax (financial) advisers

    Current registrations at 24 November 2014

    Type of registration

    Australian financial services

    Authorised representative

    Total

    Company

    454

    911

    1365

    Individual

    7

    2801

    2808

    Partnership

    1

    67

    68

    Total

    462

    3779

    4241

    3. Compliance activity

    Complaints and compliance activity focussing on BAS Agents

    For the financial year to 31 October 2014 four BAS agents have been sanctioned after failing to maintain Professional Indemnity Insurance as required by the TASA.

    Six BAS agents have been sanctioned after failing to comply with their personal tax obligation requirements.

    One company BAS agent’s registration was terminated for no longer meeting the registration requirement of having a sufficient number of registered individuals.

    Source of complaint or referral

    Total YTD at Oct 2014 for all agents

    Total YTD at Oct 2014 for BAS agents only

    External sources

    487

    31

     

    Public

    410

    26

     

    Registered agent

    53

    5

     

    ATO

    23

    0

     

    Professional Associations

    1

    0

     

    Media

    0

    0

     

    ASIC

    0

    0

    Internal sources

    66

    16

     

    TPB Registrations

    12

    5

     

    TPB Board/Legal

    8

    2

     

    TPB Regulatory Assurance

    42

    9

     

    Other

    4

    0

    Total

    553

    47

     

    Sanctions

    Total YTD

    YTD BAS agents only

    Terminations Part 4

    16

    6

    Terminations Part 3

    4

    0

    Renewals/Reg App Rejected

    0

    0

    Application to Federal Court

    0

    0

    Suspended

    2

    0

    Order Issued

    31

    7

    Written Caution

    18

    3

    Total

    71

    16

    Some agents may have more than one sanction imposed.

    4. Board information

    Financial advisers

    From 1 July 2014 financial advisers who provide tax (financial) advice can notify to register as a tax (financial) adviser with the TPB. As at 10 November we have 3,407 registered tax (financial) advisers.

    Sufficient number and fee or other reward for tax (financial) advisers

    The TPB is seeking comment on two exposure drafts addressing:

    The first exposure draft explains the sufficient number requirement which will need to be met by partnerships and companies seeking registration, or renewal of registration, as a (tax) financial adviser under the standard option from 1 January 2016.

    The TPB will consider whether the partnership or company has an appropriate number of registered individual tax agents and/or tax (financial) advisers to provide tax (financial) advice services to a competent standard and to carry out supervisory arrangements.

    The second exposure draft will assist entities to determine what constitutes a fee or other reward.

    Payroll service providers

    The TPB is currently undertaking further consultation prior to finalising the payroll service providers’ information sheet. A meeting has been scheduled for 26 November, with attendees including relevant representatives from those entities that have provided submissions on the exposure draft.

    Relevant experience requirement for BAS agents

    As previously reported at BASAAG, from 1 July 2014, the relevant experience requirements for BAS agents changed from 1,000/1,400 hours over 3 years to 1,000/1,400 hours over 4 years.

    This law change addresses difficulties for some applicants who have had a disruption to their career, for example parental leave, health and maternity leave.

    Cloud computing and software

    The Board have commenced work on providing guidance on relevant considerations for practitioners in using the Cloud environment. Relevant considerations include confidentiality, holding information in the Cloud for previous clients and software generally (including subscriptions and kickbacks).

    Once we finalise this work, the TPB will issue an exposure draft for public comment.

    Registered agent symbol

    The TPB Registered agent symbol (symbol) is now available for registered tax and BAS agents. Agents can now use the symbol to identify their registration with the TPB.

    The TPB have received 6,631 requests for the Registered agent symbol since the September launch.

    Agent type

    Requests

    BASB

    2617

    BASNB

    366

    TAB

    3188

    TANB

    460

    Total

    6631

    Agenda Item 7: BAS Agent Portal

    Director Issues and Channel Management, David Baker provided an update on developments being made to the BAS Agent Portal.

    The ATO has undertaken 24/7 monitoring of its servers to ensure they are running at optimum levels. The ATO is meeting internal benchmarks of less than three second responses to every account user.

    Practitioners are strongly encouraged to check the quality of the network connectivity between their practice and the ATO. The quality of their internet connection as well as the quality of the network within their office can impact their interaction with the ATO.

    Each year the ATO shuts down between the Christmas and New Year period. Planned system upgrades will occur during this period to minimise the impacts on the community. These include updates to ATO internal systems and a conversion process that will move over 400 million records between the ATO Integrated System (AIS) and Integrated Core Processing (ICP) systems.

    The following systems will be off-line during the shutdown period (26 December to 1 January inclusive):

    • ATO on-line
    • Tax Agent Portal
    • BAS Agent Portal
    • Business Portal
    • Australian Business Register (ABR)
    • Super Tick, ETick and the Fund Validation Service (FVS).

    The closure of these systems will mean that the ATO:

    • Will suspend business as usual system processing between 25 December and 1 January. This includes processing of refunds and hardship requests as is the case every year during the Christmas shut down period.
    • Will be unable to issue Tax File Numbers (TFN) for individual clients who apply between 18 December and 1 January 2015. This includes applications lodged though Australia Post, using the ATO on-line process and those sent directly to the ATO. The ATO does not usually issue new TFN’s during the standard Christmas shutdown period (between Christmas and New Year). There are standard provisions in place which allow employers to withhold at standard rates (instead of the top marginal rate) where a new employee advises that they are waiting on a new TFN to be issued.
    • Will be unable to issue Australian Business Numbers (ABN) or associated TFN’s for clients applying via the Australian Business Register (ABR) between the 26 December and 1 January inclusive.

    The ATO advises that where possible, practitioners lodge all requests for processing, for example registrations or refund requests that are required, early in December to avoid delays due to the shutdown of system.

    The ATO has prioritised processing of workloads to minimise holdings prior to the shutdown and expect to process all work stockpiled during the shutdown in early January within normal service standard provisions.

    A communications strategy is being progressively rolled out over the next month to inform both internal and external stakeholders of the scheduled system outages for this Christmas closedown period. This will include a SMS update being issued within the next two weeks.

    Agenda Item 8: Other business

    Stopping Paper Activity Statements

    The ATO acknowledges that the transfer to electronic Activity Statements has caused problems within the tax practitioner community.

    This issue is to be discussed at the Lodgment Working Group meeting on Monday 15 December to identify what can be done to assist practitioners with the transition to using electronic activity statements.

    Agenda Item 9: Meeting wrap up/close

    Next meeting

    The next meeting will be held at the Sydney Latitude East site on Thursday 19 March 2015.

    Other meeting dates for 2015 will be advised.

      Last modified: 20 Mar 2015QC 44590