Several accounting bodies are urging the Australian Tax Office (ATO) to amend the new tax agent linking system. The process was earlier targeted at major public and multinational enterprises with sizable in-house accounting services but will soon be rolled out for small businesses. The ATO has criticised its design as being complex and likely to prove a headache for small business clients. Similar views have been trending on social media, with some tax agents having described the process as unrealistic and convoluted.
The new process was finalised in December 2022, with professional accounting bodies including the CA ANZ, IPA, CPA Australia, and some members of the Tax Practitioners Stewardship Group, expressing frustration that they were not consulted during its setup.
As per the digital services guide provided by the ATO, an extra step has been added when linking clients that involve the use of the new agent nomination feature in Online Services for business. This feature should be used when account holders want to engage a new tax of BAS agent to represent them and when providing extra authorisation to existing authorised agents. Once clients complete the agent nomination, the selected agent has up to seven days to add the client to their client list in Online services for agents.
The ATO has stated that the changes are meant to strengthen the security of their online services. The tax body has confirmed that there have been growing efforts by criminal elements to impersonate legitimate users to gain access to people’s tax data and even lodge fraudulent tax returns. There have been as many as three million attempted hacks on their systems every month.
Overall, to add an agent, a client will need to go through six steps. This includes setting up their myGovID account to create a digital identity, lining this account to their ABN using the Relationship Authorisation Manager (RAM), authorise a tax agent to act on their behalf in RAM, log into Online Services for business, find their chosen agent and nominate them, and finally, notify the agent that they completed the online process so they can act on the nomination within the next seven days.
Though the process is considered likely to help curb fraudulent activity by unscrupulous agents, industry experts like CEO of Change Accountants & Advisors, Timothy Munro, say it would be a headache for small clients that are not tech savvy to complete.
The ATO is being reminded of how unpopular its online services are, especially as regards its recent failure to register about half a million directors as of its December 2022 Director ID rollout deadline. Some accountants have noted how a lack of consultation by the ATO when making reforms is imposing new obligations on independent agents.
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