BAS and registered tax agents in Australia have recently been issued a warning that they must make sure their professional indemnity insurance is in place by July of this year.
The Australian Tax Practitioner’s Board has recently informed its agents that they must maintain their professional liability insurance status regardless of whether their cover is provided as a benefit of their membership in a professional body or if it is provided directly by their employers.
The board remarked that compulsory business liability insurance for tax agents and bookkeepers is formulated to provide legal protection to both agents and consumers. This is to ensure that if clients make professional negligence claims against them they will have adequate cover, added the TPB.
Dale Boucher, chair of the TPB, recently stated that the costs for such cover to agents should be manageable. While premium prices can fluctuate depending on whether agents are association members, Mr Boucher stated that premiums could be as affordable as AUS$300 to AUS$400.
The Australian TPB chair stated that some practitioners may encounter higher premiums. However he added that the board considers the compulsory cover part of the cost of doing business and noted that the cost of the cover is tax deductible.
In excess of10,00 Australian tax practitioners may be affected by the new regulations. However Mr Boucher declined to put a number to how many uninsured agents in total would be subject to the new rules.
The TPB stated that the transition to the new regulations has been discussed well in advance, which has resulted in fair warning for agents. The industry body also stated that agents bear the responsibility for making sure they have the proper protections set in place.