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The Risk of Using an Unregistered Tax Agent Has Never Been Higher

With the Australian Taxation Office (ATO) and the Tax Practitioners Board (TPB) increasing compliance activity, taxpayers should be extremely cautious about who prepares and lodges their tax returns.

The TPB has identified unregistered tax preparers as a significant risk to consumers and has confirmed that it is continuing investigations, compliance activity, and enforcement action against individuals and businesses that illegally provide tax agent services without registration. [tpb.gov.au], [ato.gov.au]

If someone is charging a fee to prepare or lodge tax returns, BASs, or provide tax advice, they generally must be registered with the TPB. Operating without registration is unlawful and may expose both the preparer and their clients to significant risks. [tpb.gov.au], [tpb.gov.au]

What Is an Unregistered Tax Agent?

An unregistered tax agent is a person who provides tax agent services for a fee without being registered with the Tax Practitioners Board. The TPB states that these individuals are often unqualified, poorly trained, and in some cases may be scammers. [tpb.gov.au]

Common warning signs include:

• Promising unusually large tax refunds
• Requesting access to your personal myGov password
• Advertising tax return services without displaying TPB registration details
• Offering tax services significantly below market rates
• Operating entirely through social media or informal referrals without professional credentials

The TPB warns that if an offer sounds too good to be true, it probably is. [tpb.gov.au]

Why the ATO and TPB Are Targeting Unregistered Preparers

The TPB has publicly stated that unregistered preparers create significant risks for consumers and undermine confidence in Australia’s tax system. Its compliance strategy includes:

• Data analytics and risk profiling
• Investigations
• Intelligence gathering
• Cooperation with regulators
• Court action seeking civil penalties and injunctions in serious cases

The TPB has stated that it will continue to investigate and deter unlawful conduct by unregistered preparers. [tpb.gov.au], [ato.gov.au]

In addition, the ATO regularly shares information with the TPB where it identifies suspected unregistered practitioner activity. [ato.gov.au]

What Can Go Wrong?

1. Large Tax Debts and Penalties

If an unregistered preparer lodges an incorrect tax return containing false or excessive deduction claims, the taxpayer remains responsible for the return.

This can result in:

• Amended assessments
• Tax debts
• Interest charges
• Administrative penalties

The TPB warns that using an unregistered preparer can cost taxpayers thousands of dollars. [tpb.gov.au], [tpb.gov.au]

2. Loss of Safe Harbour Protection

One of the biggest dangers is that taxpayers may lose access to certain ATO safe harbour protections.

Where a registered tax practitioner has been engaged and the taxpayer has provided the necessary information, certain penalty protections may be available. The TPB specifically warns that these protections do not apply when using an unregistered preparer. [tpb.gov.au]

3. Identity Theft Risks

The TPB has raised concerns regarding unregistered preparers asking clients for their myGov usernames and passwords.

According to TPB guidance, registered tax practitioners do not require access to a client’s myGov credentials to act on their behalf. Sharing passwords may expose taxpayers to fraud and identity theft. [tpb.gov.au]

4. No Professional Indemnity Protection

Registered tax practitioners must meet professional standards and requirements. The TPB warns that unregistered preparers may not have appropriate professional indemnity insurance to compensate clients for losses resulting from errors or misconduct. [tpb.gov.au], [tpb.gov.au]

Tougher Penalties Are Being Proposed

In 2026, Treasury released draft legislation proposing stronger TPB sanctions and enforcement powers. Proposed reforms include:

• Criminal penalties for unregistered tax return preparers
• Increased civil penalties
• New infringement notices
• Enforceable undertakings
• Additional sanctions against non-compliant practitioners
• Enhanced powers to deter unlawful conduct

The stated objective of the reforms is to strengthen consumer protection and maintain confidence in Australia’s tax system. [beta.treasury.gov.au], [storage.go…leapis.com]

How to Check if Your Tax Agent Is Registered

Before engaging an accountant or tax preparer, you should:

1. Check the Tax Practitioners Board Register.
2. Confirm the registration is current.
3. Verify the practitioner’s details match the person providing the service.
4. Be cautious if they request your myGov password.
5. Ask for their TPB registration number.

The TPB actively encourages taxpayers to verify registration before engaging a tax professional. [tpb.gov.au], [tpb.gov.au]

Why Choose Northcity Accountants?

At Northcity Accountants, we are committed to providing professional, compliant, and ethical tax services to Australian individuals and businesses.

Our services include:

✅ Individual Tax Returns

✅ Business Tax Returns

✅ Company Tax Returns

✅ Trust Tax Returns

✅ SMSF Tax Returns

✅ BAS and GST Services

✅ Tax Planning

✅ Capital Gains Tax Advice

✅ Rental Property Advice

✅ ATO Audit Assistance

We help clients avoid costly mistakes while ensuring they receive every deduction they are legally entitled to claim.

Protect Yourself This Tax Season

The Australian tax system is becoming increasingly data-driven, with stronger regulatory oversight and increasing enforcement against unregistered preparers.

Choosing a registered and experienced tax accountant is one of the best ways to protect yourself, your finances, and your ATO compliance position.

Contact Northcity Accountants Today

Northcity Accountants

📞 03 9404 2737

🌐 www.northcityaccountants.com.au

Don’t risk your tax affairs with an unregistered preparer. Speak to a trusted, registered tax professional today.

www.northcityaccountants.com.au