Risks When Engaging an Unregistered BAS Agent

What difference does it make if your bookkeeper isn’t a registered BAS Agent? Are you exposing yourself to unnecessary issues with an unregistered BAS Agent? What are the possible dangers?

Back in 2010 The Tax Agent Services Act (TASA) became operational in governing the conduct of bookkeepers that render BAS agent services for a fee.

The term BAS services, a very broad term but includes:

  1. ascertaining BAS provision liabilities
  2. advising about BAS provision liabilities
  3. representing clients with the Tax Office in relation to a BAS provision

The primary purpose of the TASA is for consumer protection. From the 31 August 2010 all bookkeepers who were self employed had to register as a BAS Agent with the Tax Practitioners Board. I say self employed because employee bookkeepers who work for a registered BAS Agent company or people who provide BAS services for their own employer as part of their employment duties are exempt from having to register.

Basic Requirements For Registration of a Registered BAS Agent

  • Must be a fit and proper person
  • Must have a Certficate IV Financial Services (Accounting) or a Certificate IV Financial Services (Bookkeeping) from a registered training organisation or an equivalent institution as well as completing a course in basic GST/BAS taxation principles
  • Must have undertaken at least 1400 hours of relevant experience in the previous 4 years (or 1000 hours if you are a member of a Recognised Professional Association i.e. Australian Bookkeepers Association
  • Must have an appropriate level of Professional Indemnity Insurance

Ongoing Obligations

All registered BAS Agents have the following additional ongoing obligations under the TASA namely:

  • Code of Conduct [1] that involves the following principles;
  1. Honesty and integrity
  2. Independence
  3. Confidentiality
  4. Competence and
  5. Other that includes, appropriate PI Insurance, continuing professional education
  • Be a fit and proper person

Risks of Engaging an Unregistered BAS Agent

Business owners need to fully understand the owner/bookkeeper relationship since the changes have been introduced for Registered BAS Agents.

Bookkeepers perform the essential functions of recording the transactional information of the business, summarising it and then being able to explain the financial results or financial position of the business. Since the regulations have been introduced an unregistered bookkeeper is no longer able to charge for the preparation of a business activity statement, nor can they lodge it on their client’s behalf.

The issue for the client then is the preparation of the BAS. If a client cannot afford to pay the extra costs for the preparing the information for the BAS, parameters need to be in place so that the bookkeeper does not undertake the work required of a Registered BAS agent.

The responsibility of reviewing and preparing the BAS lies solely on the business owner. It’s a fact, most business owners do not have the time or the desire to spend analysing and preparing their business activity statements so their decision comes basically to a cost vs risk vs time involved decision.

Don’t Get Caught Out

Most business owners want to reduce their stress when it comes to bookkeeping. This can be accomplished if they are able to leave it in the hands of their trusted advisor who they engage to manage all the financial functions of their business. If you decide to continue to engage an unregistered BAS Agent, you need to:

  • Fully understand all GST requirements of your business
  • Be aware of the lodgement and payment due dates for BAS
  • Understand the ATO’s business portal for lodgement

Reduce Your Stress

By engaging a Registered BAS Agent you will automatically reduce your stress. You can be confident they have the relevant experience, qualifications and competence to analyse, prepare and lodge your business activity statement as per the requirements set out by the Tax Practitioners Board.

In addition, if a situation should arise where the Registered BAS Agent has allegedly breached any of their obligations you are able to lodge a formal complaint to the Tax Practitioners Board who will investigate further.

If you would like to discuss further how a Registered BAS Agent can bring added value to your business, give Lynne a call on 0402 819 611 or email lynne@uneedmeaccounting.com.au.

[1] Code of Conduct