Tax preparer standards: What do you think?

Increasing public scrutiny of the tax planning practices of large corporations and high net worth individuals is intensifying reputational risks for tax practitioners.

Increasing public scrutiny of the tax planning practices of large corporations and high net worth individuals is intensifying reputational risks for tax practitioners. Debate is spreading globally within the profession and among others involved in regulating tax practitioners over whether formal standards of tax practice are needed.

Tax return preparer registration and certification systems are already in place in the United States and Australia,  although US training and continuing education requirements for registrants are being challenged in the courts. At the November 2012 Canadian Tax Foundation conference, a senior Canada Revenue Agency (CRA) official mused publicly about whether Canada needs a system for tax return preparer registration and possibly a tax return preparer certification process. The official commented that this initiative would aim to certify people who prepare tax returns, which some countries view as a good form of consumer protection; it would not be aimed at tax planners who are not engaged in tax compliance activities.

For members of the regulated Canadian accounting profession, it is arguable that existing certification processes, codes of professional conduct and enforcement mechanisms already operate to ensure quality tax return preparation and protect the public interest. However, no standards are in place to govern the quality and behaviour of many other tax preparers in Canada who are not subject to self-regulation.

Some argue that implementing uniform standards would level the playing field for all tax preparers. At the same time, such standards would offer more consumer protection and more transparency and accountability to safeguard against non-compliance. This raises the questions as to whether the profession should take the lead in developing appropriate tax-specific standards for tax preparers in Canada.

Join in the conversation

Would you be in favour of formal certification standards and a registration system for tax return preparers in Canada? Should the accounting profession take proactive steps toward developing these standards?

Post a comment below, or email Gabe Hayos directly.

About the Author

Gabe Hayos, FCPA, FCA, ICD.D

Vice-president, Taxation, CPA Canada

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