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Don't forget your Individual client engagements

Individual Tax Returns (ITRs) are usually small fees that only occur once a year. So sending an engagement letter seems like a lot of work for little reward.

However, ignoring this vital and important process can expose a tax agent to not only compliance risks but also the risk of not getting paid and a misunderstanding of the service you are offering.


Why engaging your individual clients is a must

There are so many reasons why you should have your individual clients sign an engagement letter every year. Still, the number one reason is that both the Tax Practitioner Board (TPB) and the Accounting Professional & Ethical Standards Board (APESB) encourage practitioners to do it.

What does the APESB say?

Most accountants and tax agents in Australia must comply with the APESB as a requirement to belong to their membership bodies. The key APESB standards that relate to engagements for tax services are:

- APES 220 Taxation Services
- APES 305 Terms of Engagement

APES 220 covers the obligations when providing taxation services. A mandatory requirement of the standard is that, "A member in Public Practice shall provide the Client with an appropriate statement in writing outlining the relevant terms of the...


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