Meg's Musings - August 2026

One month on, how is everyone adjusting to our three major 1 July 2026 changes (Division 296, Payday Super and AML)? In our business, Division 296 is still largely about helping clients understand their options, Payday super problems have yet to emerge and probably our biggest learnings have been around AML.

Everyone who is providing “designated services” had to enrol with AUSTRAC by 29 July. By the end of July, around 40,000 new entities had registered (including 13,000 accounting firms).  AUSTRAC was apparently expecting around 80,000. That suggests there are an awful lot of businesses still getting to grips with what they need to do, or perhaps burying their heads in the sand.

We’ve found a few things challenging as we’ve settled into the new AML rules. 

First, we hadn’t expected to have as many clients classified as “high risk” as we have. I hasten to add that high risk doesn’t suggest dodgy! An individual can be high risk simply because of industry in which they work or where their money comes from. But meeting the classification means additional checks and sometimes delays. What makes it even harder is that the “tipping off” rules restricts us from explaining that to a client. Like many firms I expect, we’re used to being open and honest with our clients about exactly where things are up to and why. It feels quite foreign to our staff to be vague! It also means simple problems can’t be resolved as quickly as we might like. For example, we’ve already had one case where negative media mentions of a person with the same name as our client meant we needed to ask them to do more Customer Due Diligence (CDD) tests. We couldn’t explain exactly why that was happening and had to describe it as just being part of our normal process. As a result, it took longer to resolve than it might have otherwise.  

I expect many of you are experiencing similar frustrations to Heffron when it comes to the (mis)alignment of the definition of a well-established client for the Tax Practitioner’s Board and the AML rules. As a business that’s been around for nearly 30 years, we are in the crazy position of having to carry out CDD checks on people we have known for many years just because their circumstances have changed.

And don’t get me started on the confusion around the fact that multiple professional firms are now all required to carry out their own ID checks on the same client (potentially an adviser, Heffron and lawyer). Reliance agreements can help but they’re not easy to establish and require a lot of due diligence.  

I’m hoping things get easier.  I expect a positive take on the whole thing would be that it’s good to put our processes to the test early on!

At least Division 296 tax isn’t causing much grief at the moment. Although I am now knee deep in spreadsheets in preparation for our Super Intensive Days, starting this month. I’ll be updating all my modelling on this new tax to reflect the new non super tax rules – particularly when it comes to capital gains. This will put quite a different slant on some of the important decisions for clients impacted by the tax.  Looking forward to it! Although if you were hoping to attend in Sydney, I have to apologise as we’re sold out there and close to it for Melbourne and Brisbane as well. Virtual tickets, of course, remain available.