Why do Registered Tax Agents need Insurance?

Professional Indemnity (PI) insurance is designed* to provide protection for you and your business against actual or alleged claims of professional negligence or omissions in the delivery of your professional service and advice.  Your professionalism and service often aren’t always enough to prevent claims being made.

For claims covered by the policy, Professional Indemnity insurance can assist with the payment of compensation to a third party together with defence costs (these are the reasonable costs incurred while investigating and defending a covered claim including legal fees, experts fees and court costs).

 

When considering the amount of Professional Indemnity insurance you might require, you should consider the minimum amounts prescribed by TPB which are based on your businesses turnover (as set out in the table below).

Professional Indemnity insurance can be complicated, but with BizCover you can easily compare quotes from some of Australia’s leading insurers online or over the phone.

Professional Indemnity for Registered Tax Agents^

Tier Turnover from the provision of BAS services

(excluding GST)

Minimum aggregate amount of cover*

inclusive of legal and defence costs

1 Up to $75,000 $250,000
2 $75,001 – $500,000 $500,000
3 Over $500,000 $1,000,000

Please note that what is an appropriate amount of cover for an agent may in fact be more than what is set as the minimum requirement.
^Minimum PI insurance requirements source from TPB tpb.gov.au/professional-indemnity-insurance-tax-agents on 8 August 2019

What could cause a PI claim?

  • Errors and discrepancies on tax returns.
  • Incorrect tax advice.
  • Negligence in rendering professional services.
*As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained on this web page is general only and should not be relied upon as advice.

Did you Know?

The Tax Practitioners Board (TPB) requires Registered Tax Agents to have Professional Indemnity insurance as a condition of becoming a member

3 things to consider when purchasing a Professional Indemnity policy

  1. The level of cover your business may require;
  2. The level of cover that is required by your business to maintain its membership with the TPB;
  3. The start date of your policy cover– does it have an unlimited retroactive date that will provide your business with PI cover for business activities undertaken prior to policy inception (subject to known claims or circumstances exclusions) or will it simply commence from the day your purchase the policy?

* As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy document. The information contained on this webpage is general only and should not be relied upon as advice.

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Registered Tax Agent

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Registered Tax Agent

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Registered Tax Agent

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Registered Tax Agent

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Registered Tax Agent

Simple, quick and clear

Spiro T
Registered Tax Agent

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