Registered tax agents will continue to be able to provide advice to clients on the early release of superannuation without the need to hold an Australian financial services licence.
ASIC extends temporary AFSL exemption for tax agents
ASIC has extended its temporary Australian financial services (AFS) licence relief for tax agents until 15 April 2021.
The concession was first announced on 14 April and allows registered tax agents to give advice to existing clients around the early access to superannuation measure without holding an AFSL.
ASIC’s temporary relief for tax agents will continue to be subject to a number of conditions, including capping the advice fee to $300 and establishing that the client is entitled to the early release.
Clients must have approached the tax agent for the advice, and must also be provided with a record of advice (ROA).
The extension comes after the government announced that application for the COVID-19 early release of super scheme would be extended to 31 December.
Eligible citizens and permanent residents of Australia and New Zealand previously had up to 24 September to submit an application through the ATO’s online services in myGov.
The scheme has been in place since 20 April, allowing eligible applicants to withdraw up to $10,000 in the first tranche of payments up to 30 June, followed by a further $10,000 from 1 July.
While early access to super has always been a feature for those experiencing severe financial hardship or accessing on compassionate grounds, the COVID-19 measure allows individuals to apply as long as they experienced a reduction of working hours by 20 per cent or more.
As of 13 September, $33.3 billion of super has been paid out to 4.3 million applicants since the inception of the early release of super scheme.
The ATO also recently highlighted that it has begun reaching out to 1,200 taxpayers who withdrew money under the COVID-19 early release of super measure and immediately recontributed it in a bid to claim a tax deduction.
The recontribution scheme, which made its rounds around the community in late March, has been singled out by the ATO as a potential red flag that might attract the application of Part IVA — the general anti‑avoidance rule for income tax.