Privilege or concession: the modern tax adviser’s challenge

A litany of professional advisers and groups are capable of providing Australian taxpayers with tax advice.

Broadly, these advisers operate within either the accounting or legal profession and offer similar, if not identical, services. Where tax advice is sought from a legal adviser, legal professional privilege (LPP) has been held to protect confidential communications between the lawyer and their client.

In contrast, tax advice acquired from an adviser who is not a lawyer does not receive the equivalent statutory or common law protection. In some circumstances, however, the Commissioner of Taxation allows tax advice provided by a professional non-lawyer to remain confidential through a non-binding, discretionary administrative privilege known as the “accountants’ concession”.

In the cover article of July's issue of Taxation in Australia, Donovan Castelyn, Annette Morgan, and Dale Pinto, CTA (Life), argue for the abrogation of the distinction between the accountants’ concession and LPP and, in doing so, advocates for the enactment of a statutory tax advice privilege for appropriately accredited non-legal tax advisers.

The article is excerpted in this post.

The authors recommend that the framework proposed by Wilson-Rogers, Morgan and Pinto in their 2014 article, “The primacy of client privilege: designing a statutory tax advice privilege for accredited non-lawyer tax advisors”, guides the implementation of such a regime.

This article begins by outlining the current situation with respect to privilege over tax advice in Australia and considers the application of LPP in tax disputes. It then examines the distinction between the accountants’ concession and LPP, and advocates for the abrogation of the distinction in favour of the enactment of a separate statutory tax advice privilege. The final section of the article makes some concluding observations and comments on the practical limitations associated with the recommendation.

The latter part of this article briefly considered arguments for and against abrogation of the distinction between the advice provided by lawyers and non-legal tax advisers. A number of the justifications can be counterbalanced by arguments to the contrary. However, it is the position of this article that, on balance, the justifications for removing the distinction in favour of enacting a statutory privilege are compelling and timely.


The practical design issues that arise when creating a statutory tax advice privilege are numerous. It is, however, the recommendation of this article that the model devised by Wilson-Rogers, Morgan and Pinto (which advocates for an extension of privilege to align lawyers and non-legal tax advisers with respect to tax advice, subject to the non-legal adviser meeting certain pre-requisites and accreditation requirements (see the Appendix to this article))96 inform the introduction of such a regime.

It is acknowledged that, in forgoing the distinction and extending privilege to non-legal tax advisers, one public interest — encouraging full and frank disclosure — arguably compromises another, that is, ensuring that the Commissioner has sufficient information to administer and enforce the tax law and, in this way, the abrogation of the distinction may actually reduce compliance with the law.

It is submitted, however, that a formulation of the privilege based on the work of Wilson-Rogers, Morgan and Pinto would ensure that ambit of such a privilege strikes the right balance between legal and non-legal advisers. This approach would recognise the importance of taxpayers having full and frank discussions in relation to their tax affairs with non-legal tax advisers and ensure that an appropriate level of information is still available to the Commissioner and that the privilege is administered correctly.


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About the Authors


Donovan Castelyn is an Associate Lecturer at Curtin University and Clinic Supervisor at Curtin Tax Clinic.

Annette Morgan CTA, is a lecturer at Curtin University within the Taxation Area. Prior to joining Curtin on a full time basis in early 2011 she was employed as a Senior Tax Manager in a Perth based accounting firm. Annette has extensive experience in all areas of taxation gained from more than 30 years working within the taxation profession. Annette is a CTA, FCPA and holds a Masters in Taxation. Annette is also the Chair of The Tax Institute's WA Professional Development committee and Deputy Chair of Women In Tax (WA).

Prof Dale Pinto CTA-Life, is currently a Professor of Taxation Law in the Curtin Law School at Curtin University.

He is the 2018 President of the Divisional Council of CPA Australia (WA Division) and is also a Fellow of CPA Australia, a Fellow of the Australian Academy of Law and is a Chartered Accountant, Chartered Tax Adviser and Life Member of The Tax Institute.

Dale is the author/co-author of numerous books, refereed articles and national and international conference papers, and is on the editorial board of a number of peer-reviewed journals as well as being the Editor-in-Chief of several refereed journals. Chair of the Tax Institute's National Education Quality Assurance Board he is also a member of TEQSA's Expert Panel in Accounting and Taxation. Dale served as an inaugural member of the National Tax Practitioners Board and is a current member of the Board of Taxation's Advisory Panel and the ATO's Tax Technical Panel (Superannuation), as well as the Tax Institute's Technical Committees (Superannuation, Not-for-Profit Organisations and Large Business and International).

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