The eight additional obligations for tax agents in the Tax Agent Services (Code of Professional Conduct) Determination 2024 (the Determination) came into effect on 1 July 2025 for firms with 100 employees or less.
These changes are significant, as compliance with the additional obligations will lead to increased costs and time required for supervising junior practitioners, implementing risk management processes, and staying up to date with constantly evolving tax laws.
Here’s a snapshot of the eight additional obligations:
- Honesty and Integrity – Upholding and promoting ethical standards of the tax profession.
- False or Misleading Statements – Do not make statements that are false or misleading in material particulars to the Tax Practitioners Board (TPB) or the Australia Taxation Office (ATO) (more on this below).
- Independence – Have adequate processes to avoid and disclose conflicts of interest for any Australian government agency work.
- Confidentiality – Unless there is a legal obligation for disclosure, strict confidentiality requirements apply to government work.
- Competence – Provide services competently within your area of expertise.
- Client records – Record services provided to clients and keep them for at least 5 years.
- Quality management systems – Have a quality management process that documents compliance of the Code of Professional Conduct.
- Keep clients informed – Inform clients and potential clients of registration as a tax agent, any disciplinary actions by the Board or ATO.
What the Obligations Mean
Practically speaking:
- Obligations 3 and 4 typically apply to larger firms that handle government work.
- Obligations 6, 7, and 8 require the firm to appoint a quality manager (typically one of the partners or senior tax managers) to oversee quality review processes and ensure proper documentation of services provided and client engagements. In addition, Obligation 8 requires client agreements to include a disclosure in accordance with section 45 of the Determination, particularly concerning registration status and any disciplinary actions.
- Obligations 1, 2 and 5 are discussed further below.
Under the revised Code, registered tax agents must not make false or misleading statements when providing tax agent services. This includes statements made to clients, the ATO, the TPB, or other Australian government agencies, such as ASIC or state revenue offices.
A statement to the ATO or Board is not “false or misleading” if you take the reasonable steps below (discussed under section 15 (2) of the Determination):
| Situation | Reasonable Steps Required | Exemptions |
| Lodged tax return or BAS with incorrect tax information | Correct the tax return or BAS | |
| Tax advice given to a client is incorrect | Inform the client and explain consequences. | |
| Client insists on following incorrect tax advice | Withdraw from engagement | Exempt if safety is at risk or action is unlawful |
| Client is reckless or intentionally disregarding tax law | Notify the Board or ATO | Above exemptions apply |
| Further public harm suspected. | Take any further actions in the public interest | Above exemptions apply. |
Final Thoughts
The introduction of these eight new codes places significant additional onus on the already heavy compliance obligations for tax practitioners (e.g., payday superannuation changes).
We are unlikely to have full clarity on the specifics of reasonable steps (such as those concerning public harm) until these issues are tested in court.
Please do not hesitate to reach out to us if you or your colleagues would like to discuss the Determination or any tax issues. Our lawyers are able to help with any tax law issues.
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