The SMSF Association has warned accountants not to expect an extension to the 1 July deadline for the new licensing rules and has implored them to act now to ensure they will be able to provide SMSF advice legitimately under the new legislative framework.
“In our discussions with ASIC (Australian Securities and Investments Commission), the regulator has made it quite clear that there is no intention to extend the deadline,” SMSF Association head of education Liz Ward said.
“The official view is accountants have been given more than enough time to get a licence.”
While the new rules come into play on 1 July, Ward emphasised the importance of the earlier 31 March deadline flagged by ASIC as the cut-off date for any Australian financial services (AFS) licence applications from accountants.
“After this date the regulator is giving no guarantees that there will be sufficient time for accountants to meet the necessary requirements involved in getting an AFS licence,” Ward said.
She expressed concern over the lethargy accountants were still displaying regarding the issue.
“The reality is that if they are not operating under an AFS licence (full or limited), or have not established a referral arrangement or joint venture with a party that has an appropriate AFS licence, they effectively will only be able to provide tax advice to their SMSF clients,” she said.
She referred to ASIC data showing only 226 applications had been received for limited licences with only 78 licences being issued over a time frame of over two-and-a-half years.
“The other point worth making is that accountants doing any work that requires a full or limited licence will have to stop on 30 June, even if they have an application being processed. After 30 June, any accountant who provides unlicensed advice risks regulatory action, and providing unlicensed financial services is an offence under the Corporations Act,” she said.
“If you haven’t got your plans well underway by now, you have a problem.”