Time is “fast running out” for accountants planning to obtain a limited Australian Financial Services Licence (AFSL) to give SMSF-related financial advice from 1 July 2016, says the SMSF Association.
SMSFA Head of Education Liz Ward said ASIC has “repeatedly warned” that the 31st of March is the effective cut-off date for accountants looking to obtain an AFSL.
“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.”
According to the SMSFA, ASIC has only received 226 limited AFSL applications and approved only 78 licences, over the two and a half years the application process has been open. However these numbers do not include accountants obtaining full AFSLs or becoming the authorised representative of a full AFSL holder.
“Across the industry there is concern and, to some degree, bewilderment about what the 1000s of accountants who now advise SMSFs are going to do after 30 June.”
“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 AFSL, they effectively will only be able to provide tax advice to their SMSF clients.”
The SMSFA is warning accountants who expect the deadline will be extended will be “sorely disappointed.”
“If you haven’t got your plans well underway by now, you have a problem,” Ward said.
“In our discussions with ASIC, the regulator has made it quite clear that there is no intention to extend the deadline. The official view is accountants have been given more than enough time to get a licence.
“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.”
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