Accountancy Insurance Update MGI Australasia Annual Conference 2019
Speaker Victor Jahja Associate Director – Business Development M: 0402 602 689 E: victor@accountancyinsurance.com.au Accountancy Insurance
Our relationship The relationship between MGI firms and Accountancy Insurance commenced in 2010. Today we partner with the majority of MGI firms across Australia and New Zealand to protect their clients from unplanned fees incurred as a result of tax audit activity. Accountancy Insurance
About Accountancy Insurance Over 15 years of experience specialising in Tax Audit Insurance and 10 years specialising in Professional Indemnity Insurance Products designed specifically for accounting firms Thousands of accounting firms across Australia, New Zealand and Canada utilise our tailored solutions Accountancy Insurance
Solutions specifically for accountants and their clients Audit Shield Cyber Shield PI Shield Professional Tax Audit Cyber Indemnity Insurance Insurance Insurance Accountancy Insurance
Don’t risk not having Audit Shield Deciding on the most appropriate tax audit insurance solution for protecting your accounting firm and your clients should include a solution that is: Fully compliant with Underwritten by a Aligns with the Is all relevant regulatory prominent locally interests of your firm risk-free and industry bodies based insurer and your client Audit Shield accommodates all of these conditions, plus more. Accountancy Insurance
Regulatory Compliance Insurance needs to be simple, risk-free and most of all compliant. Australia New Zealand In Australia, Accountancy Insurance has In New Zealand, Accountancy Insurance have worked with regulatory bodies such as adopted the Fair Insurance Code developed ASIC to ensure that the Audit Shield by the Insurance Council of NZ (ICNZ), offering is 100% compliant. which provides you with assurance that we have high standards of service to our clients. Accountancy Insurance
Comprehensive Cyber Insurance for Accountants These measures will not stop a cyber attack: The benefits of Cyber Shield: Designed specifically for accounting firms, the cover is relevant to the needs of the profession. Competitive premiums are a certainty. Cover is comprehensive, ranging from data recovery to privacy regulatory defence costs, plus much more. Standard business insurance often does not cover you in the event of a cyber attack and antivirus software will not help to recover your firm’s expenses. Accountancy Insurance
Essential Professional Indemnity Insurance The advantages of PI Shield: PI Shield is designed to take into consideration that Designed specifically for accounting firms, the all accounting firms are different, so you can be cover is relevant to the needs of the profession. sure no matter the size or complexity of your Competitive premiums are a certainty. accounting firm, Accountancy Insurance will Cover is comprehensive, ranging from data recovery to privacy regulatory defence costs, provide you with the right cover to suit your needs. plus much more. Accountancy Insurance
Predicted audit activity trends 2018/19 Recent media headlines reveal an increase in employer obligation and payroll tax audit activity, and overall, a broader audit scope occurring in Australia. Experts at Accountancy Insurance predict that the following recent ATO initiatives will also lead to an increase in related audit activity: Single Touch Payroll Superannuation The black economy Increased (STP) guarantee task force compliance activity in the TPAR area Accountancy Insurance
Single Touch Payroll (STP) Latest updates and impacts on audit activity “The ATO is looking at the data, they are talking to people about ‘hey, we’re seeing this, should we be concerned about it?’ and we’re working with them to help them understand.” Matthew Addison, executive chairman of the Institute of Certified Bookkeepers.” AccountantsDaily, 21 February 2019 “The move to STP is the biggest legislative change for small businesses since the introduction of the GST in 2000 and it will usher in a new Tax Man tip: era of digital connectivity for Australian businesses.” With Audit Shield, accountants eliminate awkward conversations Australian Financial Review, 12 February 2019 with clients regarding professional fees associated with audit activity Accountancy Insurance
Single Touch Payroll (STP) Latest updates and impacts on audit activity Commenced in July 2018 (obligatory for businesses with 20+ employees). • Legislation passed in February 2019 – STP will be extended from 1 July 2019 • to employers with less than 20 employees. • Will require all employers to report superannuation guarantee payments concurrently to paying employees including notifying the ATO of all Superannuation Fund contributions. • Arms the ATO with new information that enables greater compliance cross- checking and inevitably this will lead to more audit activity. Accountancy Insurance
Superannuation guarantee Latest updates and impacts on audit activity “Since 1 July 2018, the ATO have completed 17,917 compliance cases around SG payments, raising liabilities of $451 million.” Accountants Daily, 7 March 2019 “New laws introducing penalties, including imprisonment up to 12 months, for non-compliance of superannuation guarantee obligations have since passed, with accountants urged to bring clients up to speed .” Tax Man tip: Across AU and NZ, we have seen Accountants Daily, 1 March 2019 through over 20,000 Audit Shield claims and on average, more than one million dollars is paid per month in claims. Accountancy Insurance
The black economy task force Latest updates and impacts on audit activity “The ATO continues to focus on the black economy with warnings that they will be knocking on the door of more than 4,000 companies between now and the end of the financial year .” Sydney Morning Herald, 5 March 2019 “The ATO has got a range of measures to address the black economy and we're getting more sophisticated in our use of data, in the use of industry benchmarks and identifying unexplained wealth .” Australian Financial Review, 12 February 2019 “The taskforce is intended to cover everything from billions of dollars in illegal tobacco flooding into shops, sham contracting and company phoenixing through to tradespeople and restaurants that evade tax by accepting payment only in cash.” Australian Financial Review, 29 January 2019 Accountancy Insurance
Increased compliance activity in the TPAR area Latest updates and impacts on audit activity “If your clients have not lodged their 2018 or prior year taxable payments annual reports, now is the time to get them back on track to avoid penalties.” Accountant Daily, 30 January 2019 “The ATO confirmed that its taxable payments reporting system had recovered $2.7 billion in "black economy" money from the building and construction sector, according to its most recent numbers for the 2015-16 financial year. More business sectors will have to do this reporting and will be required to spill the beans on what they pay contractors from July 1.” Sydney Morning Herald, 13 February 2019 Tax Man tip: With Audit Shield your clients receive retrospective cover so “Businesses who are doing the right thing don’t need to worry, however all previously lodged returns if you’re not meeting your tax obligations there will be consequences.” are included. Australia Taxation Office, 12 February 2019 Accountancy Insurance
Hot issues – ATO and CPA Australia “With LRBAs and TBAR two of the major focus areas for the ATO this year, the tax office has announced plans to contact trustees with high concentration risk in their funds and toughen its stance on misreporting.” SMSF Advisor, 1 March 2019 “Accounting practices should be alert to a growing number of pseudo tax audit protection services being offered that, on the surface, may seem like a cost-effective solution, but underneath effectively involve practices paying for a service with no insurance backing .” INTHEBLACK – CPA Australia, 26 Feb 2019 “The ATO will undertake 4,500 audits of taxpayers it considers are ‘high risk’ because they over claim or don't declare income relating to rental properties .” ABC News, 22 March 2019 Accountancy Insurance
Australian Tax Office 2017-18 Annual Report highlights ⊲ Audit yield of $11.8 billion, representing an increase of $1.6 billion on the previous year ⊲ Release of tax gap estimates for superannuation guarantee ⊲ Analysis conducted for the gaps related to large and small superannuation funds, and income tax for individuals not in business. ⊲ Expansion of work-related expenses program to interact with over one million taxpayers ⊲ Introduction of the first phase of STP for employers with 20 or more employees Accountancy Insurance
In the media- IR “The introduction of capital gains tax has been recommended by the Labour government’s Tax Working Group, established to consider NZ’s options on tax changes.” Herald Sun, 1 March 2019 “Inland Revenue will review the information and verify that correct tax is being paid on offshore investments. New Zealand taxpayers are strongly advised to check they have correctly accounted for their offshore investments .” IRD News. 5 March 2019 Accountancy Insurance
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