Financial advisers and SMSF administration service providers should be given access to relevant client information held by the ATO, but in a read-only capacity, the SMSF Association (SMSFA) has told Treasury.
As part of its response to a review of the tax regulator secrecy exceptions, the association noted a lack of consistency in what the law said qualified tax relevant providers who provide tax (financial) advice were allowed to do and the information available to them.
The SMSFA submission pointed out a ‘tax (financial) advice service’ was defined in the Tax Agent Services Act as advice provided by a financial services licensee or a representative of a licensee on which a client could be expected to rely to satisfy liabilities or obligations or claim entitlements under taxation law.
“These elements of the definition mirror the definition of a ‘tax agent service’,” the submission stated, adding: “Of crucial importance here is the direct correlation for the provision of tax advice and the reliance a client can place in that advice.
“Parity is needed for all tax professionals to ensure that each cohort has access to information essential in the provision of timely and accurate advice to their clients.
“Significant disparity arises between professionals due to the operation of the transfer balance cap and total superannuation balance provisions.
“Financial advisers are licensed to provide superannuation contribution and pension advice, but unable to access the information necessary to provide that advice.”
The industry body also noted the barriers facing financial advisers in accessing information were similar to those seen by SMSF administration service providers, despite some of them already being tax agents.
“Due to the specialist nature of SMSFs, it is not uncommon for a different tax agent or administrator to attend to the SMSF’s taxation and accounting services, to the tax agent who looks after the individual’s personal taxation matters,” it noted.
“SMSF administrators are registered tax agents with existing rights to access the ATO’s online services. However, access is strictly limited to the SMSF only and does not extend to the fund members. Yet member information, crucial to the performance of their role, and the services provided in relation to the SMSF are not accessible.”
The submission added administrators were unable to view an individual’s transfer balance account, but had the responsibility to report events that impacted their super account and to manage pension interests, and were also unable to access information regarding an individual’s contributions, bring-forward caps and total super balance.
“Access to this data by SMSF administrators is important for many reasons. For example, it would enable the early detection of reporting errors and would greater assist SMSF administrators to provide SMSF members with more accurate and complete information about their superannuation tax affairs,” it said.
