Major change to the ATO’s Tax Agent Portal
20 November 2019
UPDATE – 20 May 2020
Due to federal parliament sitting in May, the Taxation Administration (Remedial Power—Disclosure of Protected Information by Taxation Officers) Determination 2020 has passed into force as of 15 May 2020.
The ATO is now able to disclose information about the taxation affairs of a deceased person to:
(i) a registered tax agent or BAS agent appointed by an executor or administrator of the deceased person’s estate with a grant of probate or letters of administration; or
(ii) a legal practitioner representing an executor or administrator of the deceased person’s estate with a grant of probate or letters of administration.
To see the ATO’s updated information relating to this issue click here.
Updated 7 April 2020
QLS Members are advised that a major change to the ATO’s Tax Agent Portal commenced on Friday 29 November 2019, which could result in significant delays in the administration of estates.
Key Change: The ATO’s Tax Agent Portal has been decommissioned as of Friday 29 November 2019. Registered tax agents are no longer be able to access a deceased person’s pre-death tax data except in certain limited circumstances.
The ATO is automatically notified of a taxpayer’s death via data matching when the death is registered at a State or Territory registry of births, deaths and marriages. Tax agents do not have access to pre-death tax data under the new online services for agents (OSFA) except where the taxpayer’s death was notified to the ATO before 29 November, in which case the tax agent is still linked with the deceased taxpayer in OSFA until the tax agent initiates de-linking. Otherwise, even where a tax agent was the deceased person’s tax agent during the deceased person’s life, they will lose access to pre-death data, unless the tax agent is also the deceased person’s legal personal representative (LPR) and has obtained a Grant of Representation (in which case they can re-link to the deceased’s data in OSFA).
Why has this happened?
- Section 355-25(2)(d) of the Taxation Administration Act 1953 (the TAA (1953)) technically provides that only an LPR can access the deceased’s history to date of death as such data is otherwise regarded as being protected confidential information which can only be issued to the LPR of the deceased’s estate (and not an agent appointed by the LPR).
- The ATO's new OSFA platform has been designed to strictly adhere to the protected information rules under section 355-25(2)(d) of the TAA (1953). Historically, such information has been available on the ATO’s legacy Tax Agent Portal which was not specifically configured to comply with this provision.
- As the ATO’s Tax Agent Portal has been decommissioned from Friday 29 November 2019. The only digital repository of information now available is the ATO OSFA which denies access to a deceased’s personal information to anyone other than the LPR where the ATO receives notice of the death after 29 November. Tax agents linked to deceased taxpayers where the ATO received notice of the death before 29 November have not been automatically de-linked and will still be able to access information about those deceased taxpayers through OSFA, though tax agents who are not LPRs with a grant should de-link the account on their own initiative.
- It should be noted that ATO call centre staff have also commenced applying these provisions to in-bound calls at their call centres.
What does this mean for members?
- Registered tax agents are not able to access pre-death data for a deceased individual via ATO OSFA except where they are already linked to a deceased taxpayer and the ATO was notified of the death before 29 November, though as mentioned above those tax agents should de-link on their own initiative unless they are the LPR with a grant.
- The only person to whom the ATO will now release pre-death data via OSFA is an LPR with a Grant.
- The only way to obtain pre-death data from the ATO is by the LPR writing to the ATO to request it. The ATO will send a pack of historical information concerning the deceased’s tax history to date of death to the LPR. The LPR will then be able to provide the pack to their lawyer or accountant to assist in the estate administration process and managing any pre-death tax issues that exist. Information about obtaining the data package is available here.
- If additional information is required by an LPR’s lawyer or accountant, the LPR needs to seek that information from the ATO directly.
- Given the legislative privacy provisions, the ATO is not able to deal directly with an LPR’s lawyer or accountant.
- Please note that this change only applies to pre-death tax affairs of a deceased person.
What has QLS been doing to resolve the issue?
- The QLS Succession Law Committee has been proactively working with senior ATO management and other key stakeholders for a considerable period of time on an administrative interim solution to accessing a deceased’s pre-death data on the ATO’s OSFA. We have also advocated for a more permanent legal solution which will allow registered tax agents to directly access such data under section 355-25(2)(d) of the TAA (1953).
- Whilst the ATO is legally required to correctly apply section 355-25(2)(d) of the TAA (1953) in the above manner, they have nonetheless determined that the Commissioner of Taxation can exercise his remedial powers under Division 370-A of Schedule 1 of the TAA (1953) to modify the application of section 355-25(2)(d) of the TAA (1953) to allow the ATO to disclose a deceased person’s confidential information to the registered tax agent appointed by the LPR with a grant. It is contended that such an interpretation is not inconsistent with the intended purpose or object of the protected information rules under section 355-25(2)(d) of the TAA (1953).
- Modification of the operation of a taxation law under the above remedial power must be mandatorily set out in a Legislative Instrument made by the Commissioner. Such a Legislative Instrument can only take effect on or after the first day that the relevant Legislative Instrument can no longer be disallowed by Parliament, which is taken to occur 15 sitting days after the instrument has been tabled in Parliament. The Legislative Instrument, the Taxation Administration (Remedial Power - Disclosure of Protected Information by Taxation Officers) Determination 2020, was tabled on 4 February 2020. It cannot come into effect until after the Senate disallowance deadline which has now been delayed until August 2020 due to changes to the parliamentary calendar as a result of COVID-19.
What is the interim solution?
- Where a member acts as an LPR or advises an LPR, it is important to recognise that the LPR needs to act as an intermediary between the LPR’s lawyer or accountant and the ATO until the above Legislative Instrument takes force later in 2020.
- During this interim period the LPR will essentially need to request the ATO to send a pack of material on the deceased’s pre-tax information to the LPR in accordance with the information available here.
What are the critical issues?
- The pre-death tax data of a deceased person can no longer be accessed online by registered tax agents (unless they are the LPR with a grant).
- Members should be aware that obtaining pre-death tax information from the ATO will likely be slower than it has been previously and that the LPR must act as an intermediary between the ATO and the tax agent or lawyer.
QLS acknowledges the generosity of Ian Raspin of BNR Partners upon whose text this release is based.
The ATO’s information on accessing a deceased person’s information can be found here.