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ATO loosens constraints on client linking process

Tax

The window to complete nominations expands fourfold and a report feature details linking requests, the Tax Office says.

By Philip King 10 minute read

The ATO has vastly expanded the window for agents to link with clients and introduced a report feature to aid the onboarding process before it becomes mandatory for all businesses – except sole traders – next month.

The moves come after widespread concern about the complexity of the six-step process, particularly for smaller businesses lacking technical nous, and showed the ATO was responding to feedback, it said.

Under the changes, the nomination period extends to 28 days instead of just seven, and agents can access an online report that details which clients have completed linking requests.

The ATO said both changes were made after consultation with agents already using the system.

“We have sought feedback from agents on the seven-day expiry period with respect to the next population of clients to receive this solution,” an ATO spokesperson said. “Based on feedback, we have agreed to extend the period to 28 days.”

The extension applies from 13 November when the revised linking system becomes obligatory for all taxpayers bar individuals and sole traders, hugely expanding its scope to take in roughly 1.7 million additional ABN holders.

The ATO said the report feature was also added recently after consultation.

“Agents can produce a report on demand and in real-time to see which clients have completed the nomination form, allowing them to add the client to their client list,” the spokesperson said.

“We heard from agents this was needed to manage their onboarding process. We listened to this feedback and added the feature recently. All agents who use online services for agents can access this report.”

“We have also developed a PDF document clients can download which shows they have successfully completed the nomination process. This is available to be sent to their agent to notify them.”

The ATO said in other respects the process was unchanged from last year, when pilot trials began with large businesses and wealthy private groups.

However, neither change addresses a key criticism by tax and BAS agents that they can be inadvertently disconnected by an accountant servicing the same client and then face the prospect of an onerous reconnection process.

The ATO recently acknowledged the issue and said it was working on a fix, but reiterated a procedural caution to accountants.

“If an agent is authorised by the client to manage their income tax account, agents should only link to this account. They will be authorised to act on behalf of the client for all of the client's accounts and no further action is required,” the spokesperson said.

“If there's another BAS or tax agent authorised to act on behalf of the client for an activity statement or GST joint venture account, an existing agent link will be displayed against that account. Agents should not remove that agent unless they have authorisation from the client to do so.”

The Institute of Certified Bookkeepers said the problem, a carry-over from the current system, was already creating angst among its members and the ATO should have fixed it before extending the rollout.

“It’s a fundamental flaw inside the design of the agent linking system but the ATO seem convinced that they’ve got the design right,” CEO Amanda Linton said.

When the six-step linking procedure was outlined by the ATO late last year, it prompted a storm of protest on social media and angry comments from Accountants Daily readers who described it as a “joke” and “absolutely ridiculous”.

The ATO said the timetable for rollout was driven by security demands.

“The client-to-agent linking deployment continues to ensure that we are strengthening the system to protect client information from criminals who seek to access information the ATO holds on clients.”

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Philip King

Philip King

AUTHOR

Philip King is editor of Accountants Daily and SMSF Adviser, the leading sources of news, insight, and educational content for professionals in the accounting and SMSF sectors.

Philip joined the titles in March 2022 and brings extensive experience from a variety of roles at The Australian national broadsheet daily, most recently as motoring editor. His background also takes in spells on diverse consumer and trade magazines.

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