Australia is bringing its laws into line with international standards set by the Financial Action Task Force (FATF). Accountants, lawyers, real estate agents, and dealers in precious metals are being brought under the regime because these professions can be exploited by criminals to launder money - often without the professional even realising it. The reforms were passed into law on 10 December 2024 and take effect on 1 July 2026.

Yes, but in a straightforward way. You may notice some changes in how we work with you - particularly when we take you on as a client or when we provide certain services. In practice, this may include requests for identification documents, additional questions about the purpose of a transaction, and requests for documentation before some services can be provided. These steps are required by law - they’re not something we’ve chosen to introduce. For most clients, the process will be simple and quick.

Absolutely not. These checks are applied to every client, at every accounting practice, across the country. They’re not triggered by suspicion - they’re a blanket legal requirement, just like the ID checks at a bank. It’s not personal and it’s not optional. We’re required to do it by law.

No. The rules only apply when we provide certain services known as “designated services.” Whether the rules apply depends on the type of service being provided, not simply the fact that you’re working with an accountant. Preparing a standard tax return or providing general tax advice is not a designated service on its own however the net is so wide that at Smart Business Solutions, given we are a business accountant and not a H&R Block type individual tax return focused business , we don't believe any of our clients will be excluded, even working on a Div 7A loan brings the service in.

Yes. Firms that provide designated services are required to enrol with AUSTRAC as a reporting entity. Enrolment opens from 31 March 2026, and we must be compliant by 1 July 2026. This is a requirement for our firm, not for you as a client - but it’s part of why you’ll see some new processes when we work together.

We have an obligation to conduct ongoing due diligence on the services we provide to you. This means we’ll keep your information up to date and may ask you to confirm or update details from time to time. If anything unusual comes to our attention in the course of providing services, we’re legally required to assess it. This is a standard obligation that applies to all clients - it’s not a reflection of any concern about you personally.

We are legally required to monitor all clients continuously for

• Suspicious transactions and behaviours that could trigger an SMR
• Check all clients against the DFAT Consolidated List (dfat.gov.au/consolidated-list), this must be performed daily for active clients, and hence we have invested in technology to do this
• Monitor PEP registers for any client individuals on an ongoing basis
• Run adverse media scans (name + fraud, bankruptcy, criminal charges) at appropriate frequency
• Review and reverify KYC information when we have doubts about its accuracy or when risk changes
• Monitor for significant changes in the nature or purpose of the business relationship
• Review transaction lists at BAS time and year-end for cash transactions over $10,000
• Lodge TTR with AUSTRAC for any physical cash transaction of $10,000 or more — no judgement required
• Lodge SMR with AUSTRAC when we have reasonable suspicion — log reference number immediately
• Submit Annual Compliance Report (ACR) to AUSTRAC by 31 March each year
• Schedule independent evaluation of your AML/CTF Program every 3 years

The identity verification is largely a one-off process. But the obligations are ongoing - we’ll need to keep your information current and may ask you to update your details from time to time. If your circumstances change significantly - for example, you move overseas or restructure your business - we may need to do additional checks.

Yes. If we form a suspicion that a transaction or activity may be related to money laundering, terrorism financing, or other serious crime, we’re legally required to report it to AUSTRAC. This is called a suspicious matter report. These reports help authorities detect and disrupt serious and organised crime and protect the Australian community.

No - and we’re not allowed to. Under the law, disclosing that a suspicious matter report has been made (or is required to be made) is a criminal offence known as “tipping off.” This applies to every accountant in Australia, not just our firm. If we seem unable to discuss certain aspects of a matter, please understand this may be because we’re bound by these legal restrictions.

In some situations, yes. If we’re unable to satisfactorily complete the required identity checks, or if the risk assessment identifies concerns that can’t be managed under our compliance program, we may need to decline a designated service. This is uncommon, but it is part of our legal obligations.

Yes. Providing a registered office or business address is classified as a designated service under the new AML rules. This means we’ll need to complete identity checks for any company using our office as the registered address. In most cases, we’ll do this as part of your regular annual engagement - and because we may already have many of the required documents on file, the process should be relatively quick.

Under the new AML regime, we must sight the trust deed to complete due diligence on a trust. If the deed cannot be located, we cannot provide a designated service to the trust until the matter is resolved. If your deed is missing, there are two main options: applying to the Supreme Court to confirm the trust’s terms, or winding up the existing trust and establishing a new one with a fresh deed. Both require legal advice from a solicitor, and we can help you work through the options. If you think your trust deed may be missing, please raise it with us sooner rather than later - both options take time.

Yes, each entity that requires a designated service will need its own identity verification. However, where individuals are involved across multiple entities (for example, you’re a director of two companies and a trustee of a trust), your personal identity only needs to be verified once. We’ll coordinate the process across your structures to keep things as efficient as possible.

We can accept certified copies of identification documents or use electronic identity verification methods. If you’re overseas or interstate, get in touch and we’ll talk through the options - there are ways to complete the process remotely.

The rules apply to specific professional services that involve financial transactions or the creation of legal structures. Some examples of services that may be covered include:

•        Assisting with buying, selling, or transferring real estate
•        Assisting with buying, selling, or transferring a company or trust
•        Holding, managing, or controlling client money, accounts, or property
•        Assisting with equity or debt financing transactions
•        Creating or restructuring companies, trusts, or other legal arrangements
•        Acting as (or arranging for someone to act as) a director, secretary, trustee, or partner on your behalf
•        Providing a registered office or business address on behalf of a client

If we assist with services like these, the AML/CTF rules apply.

It depends. Preparing a standard individual tax return is generally not a designated service on its own. But if we also help you with things like setting up a company, managing a trust, handling client money, or assisting with the sale of a business, those activities are designated services - and the requirements apply. Even a Directors Loan qualifies. Therefore, at Smart we have assessed that all clients of Smart will require AML/CTF lodgement and monitoring as the risk/fines to Smart if we perform one service without this are $260,000 or 2 years jail, not worth the risk!

There may be a small amount of additional time at the start of a new engagement - particularly for the initial identity check. Once your identity has been verified, the process for ongoing services should be seamless. For most clients, it’ll feel similar to the onboarding process you’ve experienced with a bank.

Under the new laws, we’re legally required to verify the identity of every client before providing a designated service. This is called customer due diligence. It’s not optional - it’s a legal obligation, and it applies to both new and existing clients. Banks and financial institutions already follow similar processes.

Typically, you’ll need to provide your full name, date of birth, and residential address. We’ll verify this against a government-issued photo ID such as a driver’s licence or passport. For businesses, trusts, or other structures, we may also need information about directors, beneficial owners, or trustees.

In many cases, we may already have some of the key documents - trust deeds, company constitutions, ASIC extracts, and similar records are sometimes kept at our office. Where that’s the case, we’ll work with whatever records we already have and only ask you for anything that’s missing or needs updating. The main item you’re most likely to need to provide is a current photo ID.

We understand this might feel unnecessary after a long relationship. But the new laws require us to have formal identification on file for all clients we provide designated services to - not just new ones. Think of it as a one-off process that brings your file up to date. Once it’s done, it’s done.

Not necessarily. The level of checks depends on the risk associated with the service or transaction. For most individual Australian residents using straightforward accounting services, the process will be simple. In some situations - such as complex structures, international elements, or higher-risk transactions - we may need to collect additional information. A higher level of checking doesn’t mean anything is wrong. It’s a standard part of the process.

In certain situations - particularly where an engagement involves large sums, complex structures, or international elements - the law requires us to ask about the source of funds for a transaction and how your overall wealth has been accumulated. These are standard risk-assessment questions required by the legislation, not a reflection of any concern about you.

A PEP is someone who holds or has held a prominent public position - such as a government minister, senior public servant, judge, or military officer - or a close family member or associate of such a person. The law requires us to ask this question as part of the standard due diligence process. It’s asked of every client, not just those suspected of anything.

We may not be able to provide you with certain services. Under the law, we must complete identity verification before providing a designated service. If we can’t verify your identity, we may need to limit the services we offer you. We don’t want that outcome - so the sooner we can get your details on file, the better for both of us.

Yes - we’ll ask you to complete a short onboarding form with your personal details. This is used to collect the information we need for identity verification and risk assessment. It’s straightforward, and we’ll guide you through it.

Yes. We’re required to keep your information secure and only use it for the purposes required by law. AML/CTF records must be retained for at least seven years, and we must comply with the Privacy Act 1988 in how we store and handle your data. Your information won’t be shared with anyone outside of what the law requires.

Our firm is now required to invest in compliance systems, staff training, identity verification processes, and ongoing monitoring - all of which have costs. Whether and how those costs are reflected in your fees will depend on the services you use. If there are any changes, we’ll discuss them with you.

For most clients, no immediate action is required. However, from 1 July 2026, you may be asked to provide identification or additional information before we can proceed with certain services. Providing this promptly will help make sure there are no delays. If you’ve already been asked to complete an onboarding form or provide ID, that’s this process in action - and we appreciate your cooperation.

The most useful thing you can do is make sure your photo ID is current and your contact details are up to date with us. Beyond that, there’s no action required until a designated service is needed. When the time comes, we’ll guide you through exactly what’s required.