Accountants operating without an Australian financial services licence (AFSL) must ensure they remain compliant when communicating the new non-concessional contribution (NCC) rules to clients, an industry SMSF lawyer has warned.
During the latest DBA Lawyers SMSF Online Update, director Bryce Figot said the changes to the NCC rules announced on 15 September were big news for lots of SMSFs and subsequently generating many enquiries.
“Many clients will appreciate being contacted by their advisers and some clients almost certainly want to make contributions pre-1 July 2017 but how do you convey this information to clients?” Figot said on Friday.
“This question is relevant for both non-licensed accountants and those licensed who might not want to do a statement of advice (SOA).
“[While we want to] tell all our clients who are calling us up that if they’ve got the money, put the money in now and don’t wait until 1 July 2017 however how do you integrate this with the AFSL regime?
“We have got to think about that in the context of the AFSL regime and more specifically, how should this situation be handled.”
Figot reminded unlicensed accountants they are able to provide simple factual information by stating accurate facts about the recent NCC rule change without including a recommendation or statement of opinion intended to influence.
“Objective and factual information is not intended to influence a person’s decision on a financial product,” he explained, adding the way the response was framed was crucial.
He said accountants not under the AFSL regime could possibly respond with the following: “I note that I cannot provide financial product advice and therefore cannot make recommendations in relation to making superannuation contributions and only provide factual information, accounting and tax advice in relation to SMSFs.”
Or for licensed accountants who do not want to provide a SOA, Figot recommended they use: “I am not providing financial product advice. More specifically, I am not providing a recommendation or statement of opinion that is intended to influence you.
“Rather, I am only providing information that is purely factual and can be objectively determined as being accurate.”
These two examples of practical responses for clients followed by an outline of the general changes, the transitional rules and a confirmation of instructions, including an acknowledgement by the client that they have understood no advice was made in relation to contributions, should address topical enquiries coming to unlicensed accountants, he said.
Earlier this month the government scrapped its proposed super measure for a $500,000 lifetime NCC cap.
It was replaced with an NCC cap of $100,000 a year with a maximum threshold of $1.6 million, and includes a three-year bring-forward rule.
Treasurer Scott Morrison said legislation for all measures would be introduced by the end of the year.
