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FASEA standards tempt financial advisers to tax advice

Tax

The incoming education requirements from FASEA could see financial advisers further explore accounting advice heartlands, with many advisers expanding their services into business succession planning and tax advice, according to one consultant.

By Miranda Brownlee 11 minute read

Mayflower Consulting director Sarah Penn said ever since the removal of the accountant’s exemption, many financial advisers have been extending their services into the sorts of advice that would traditionally be offered by accountants.

The introduction of new education requirements for financial advisers, which will require many of them to obtain a degree and expand their skill set, is likely to see this continue further.

“The [sorts of services] they’re offering look very similar to what an accountant would talk about; how to structure your business, tax concessions and succession planning,” she said.

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“I think it’s a bit of a case of be careful for what you wish for. It’s all very well for accountants to roll their eyes and poke fun at your average financial planner but it’s now coming home to roost.”

In the long term, in around 10 or 20 years, Ms Penn said there may not be a difference between what an accountant and what a planner look like because they’re actually converging.

“On the accounting side, compliance work is becoming more and more automated so if you want your business to be worth something it’s got to be around advisory and client relationships and structuring and all that stuff,” she explained.

“On the other side you’ve got financial planning, where the pressure on asset fees is immense, and people are realising that you can’t add a lot of value of the investment side besides asset allocation and certain investments.”

Financial planners, she said are therefore looking for higher-level strategies such as structuring and opportunities for their clients and that’s starting to look similar to what accountants offer.

“There’s a bit of a twist on both sides, one is more about tax and tax minimisation and company structures, which is accounting, while financial planning is how to allocate your resources for maximum benefit in the long term, but they’re starting to become very similar,” she said.

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Miranda Brownlee

Miranda Brownlee

AUTHOR

Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.

Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.

You can email Miranda on:miranda.brownlee@momentummedia.com.au
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