Accountants’ exemption debate ‘back on the radar’, says IPA

During the lead-up to the election, Mr Conway said the Prime Minister and Treasurer wrote to the accounting bodies, including the IPA, explaining its position on the $3,000 cap proposed by Labor.

One of the interesting elements about the letter, he said, is the fact it stated the government was concerned about the impact of these changes on Australian residents and the economy in terms of discouraging Australians from getting the financial advice they need, and then depriving them of their rightful income.

“Well, I would argue that the current regime, the current financial services law, is doing just that. Accountants should be able to provide advice in relation to SMSFs,” said Mr Conway at an IPA event in Sydney.

“An SMSF is a business structure. It is nonsensical that you can have a client come through the door of your practice today and ask for advice in relation to investing in plant machinery in their business for millions of dollars, and you can provide advice on that, but the minute that client mentions to you that they’re going to use part of their superannuation, the roller door has to come down. It is ridiculous.”

Mr Conway said the IPA believes there needs to be a review into the way in which financial advice is provided in this country, and ensure the playing field is level.

“We don’t know if we’ll be successful, but we hope so. We had a very good hearing with the outgoing Assistant Treasurer, Stuart Robert, and we hope the incoming assistant treasurer and new assistant minister for superannuation and financial services will listen to this case, because the data is pretty alarming,” he said.

Mr Conway noted that the establishment rate of SMSFs has declined in recent years. According to the latest ATO statistics, net establishments for SMSFs have dropped from 20,511 for the 2015–16 financial year, down to just 5,027 for the 2017–18 financial year.

“I think that’s concerning. We’re certainly not saying that in every case an SMSF is the appropriate structure, but the very fact that the establishment rates have decreased so significantly and sharply ought to be a policy concern.

“I also don’t want to get stuck into industry funds, but we have also seen that $5 billion from the SMSF sector has flowed into the industry super fund sector in the past 12 to 18 months. Some have suggested that a decline in the number of SMSFs has led to an almost proportionate rise in the number of industry super fund accounts.”

While Mr Conway said this isn’t necessarily right or wrong and depends on the individual in each case, it is wrong, he said, that Australians have less access to the advice they once could get.

“I think that ought to be a financial services policy priority for the incoming Morrison government and ministry, and we’ll be prosecuting that case,” he said.