Need help troubleshooting the ATO’s CAL?

Garreth Hanley:
This is With Interest, a business Finance and Accounting News podcast, brought to you by CPA Australia.

Gavan Ord:
Hello, welcome to With Interest. I'm Gavan Ord. And today we'll be talking about the ATO's client-agent linking process, sometimes known as CAL. The client-agent linking process or CAL is impacting many businesses and their tax agents. In today's show, we'll be covering the basics of client-agent linking and the common issues people are encountering with the process. And then our guest expert will be answering some of the specific questions and troubleshooting some real-world issues that have been submitted to CPA Australia by members. Joining us today is Hannah Griffits. Hannah is a public practitioner at Moore Lewis & Partners Accountants in Toowoomba Queensland and is also the deputy chair of CPA Australia's Public Practice Committee in Queensland. And in 2023, Hannah won CPA Australia's prestigious Murray Wyatt Award for her work with the mentoring future CPAs. Welcome to With Interest, Hannah.

Hannah Griffits CPA:
Thank you for having me, Gavan. It's pleasure to be here today to talk through some of these issues.

Gavan Ord:
Yeah. Thanks, Hannah. And it's definitely an issue That's a hot topic for our members. The common issue raised with us is the amount of time people spend on ATO helplines to resolve client-agent linking problems. Do you have any tips as to how to expedite the process or can people actually avoid calling the ATO in the first place?

Hannah Griffits CPA:
So this is a common issue across the board. I think my main suggestion would be for clients to make sure that they have their details updated on the ABR before they attempt to do the linking process. So any difference in the trustee details, even if small, can cause major issues when attempting to link with the client. It's also important to ensure that you are linking at the right level. For example, if you're linking at the activity statement level, you need to do the nomination process again to be nominated at the income level.

Gavan Ord:
And that's a good tip on the ABR. I know a lot of businesses updated their ABR during COVID to get access to government grants, but there are quite a lot of businesses, particularly not-for-profits, that the ABR records are not up-to-date.

Hannah Griffits CPA:
Yeah. And I've seen that cause a whole lot of issues when they go to link, that names of trustees and things like that don't line up. So it's really important just to make sure that they're all lining up before you start that process.

Gavan Ord:
Question two is requiring clients to link to their new agent is clearly a burden for some if not many taxpayers. And it may lead to some deciding that changing their account is too difficult so we've heard that quite a bit. When taking on a new client, how do you explain the process to them so they don't feel threatened by it?

Hannah Griffits CPA:
I think it's really important that when we're liaising with clients regarding the client-agent linking that we're talking in a positive light. If the client goes into it with only a negative view and only having heard negative things, then their overall experience won't be positive. So in our firm, we have done up a client info sheet based on the instructions provided by the ATO to give to clients and try and make that process a little bit easier. It's also probably important that we inform the clients as to why the ATO are doing it and that why it will be a good thing in the long run and that's just not this negative thing that is sitting there.

Gavan Ord:
Yeah. And I think the why is important. And obviously the why is that there has been some fraud where tax agents have selected someone to be their client who actually wasn't their client. So I think we can all get why the ATO is doing it. And maybe just how they're doing, it's probably the issue, but I think we can all get why the ATO is doing it.

Hannah Griffits CPA:
Yeah, I think it's making sure that the client is aware that that's why they're doing it as well. That's not just adding regulation for the sake of adding regulation.

Gavan Ord:
Yeah, that's right. Before we started, we were just talking about maybe older clients with limited technology skills. So how do you help these older clients or people with limited technology skills navigate the process? Can you be directly involved in helping them? And what can be done to correct any mistakes they might make during the linking process?

Hannah Griffits CPA:
So due to security reasons, we can't do the process for the client. However, I think if we provide support along the process, then that's going to help the client out a lot. I think it's important also to stay connected with the client throughout the process so that they feel like they're not alone in what they're doing. We have a lot of older clients who probably have the limited technology skills, so we sort of just make sure that we stay connected with them and stay talking to them so that they feel like they've got a partner in the process rather than just being on their own.

Gavan Ord:
And do you have any specific examples where you've actually helped a client through the process?

Hannah Griffits CPA:
Yeah, so we've had a few of our older clients that they've come in, we've sat down, they've done the myGov on their phones, they've done that while they're sitting here with them so that they have some confidence in it. So now with the older generation they sometimes lack that confidence to, "Okay, go to the next step" because they're not sure whether it'll delete something, go add something they're not meant to. So they want their handheld through that process.

Gavan Ord:
And I know it's not just older clients that struggle with technology sometimes as well, so...

Hannah Griffits CPA:
We all can sometimes.

Gavan Ord:
Exactly. Exactly. Next question's around identity. One of the issues that keeps coming up is around people that don't have what's called a strong identity. For example, they don't possess a current Australian passport. Is there a way around not having to call the ATO if you don't have a strong identity or ways around not incurring the expense of getting a passport to create that strong identity?

Hannah Griffits CPA:
Unfortunately, I don't have the magic answer for that one. As clients need the strong myGovID to link their business to the RAM, a passport is needed or they will need to call the ATO to verify their ID that way. I'm hoping in the future as the ATO are continuing to iron out their bugs, that might become an easier process. They might have another way that they can verify the identity because I think it's crazy. 47% of the country doesn't have a passport, so it's not as common as you think.

Gavan Ord:
And I think this is an issue that has to be addressed, particularly when we move to individuals and client-agent linking, so then that problem becomes significantly greater.

Hannah Griffits CPA:
Yeah, because at the moment we've only obviously ABN holders and businesses, but when we are going to everyone, it's really going to become an issue.

Gavan Ord:
Well, just on that, so you've gone through this process, we know many of our members are going through this process, we know many business people have experienced difficulty with client-agent linking. What improvements would you like to see the ATO make to CAL?

Hannah Griffits CPA:
So the biggest issue I found with the whole process is not actually the nomination process itself, but the setting up of the myGovID and meeting the identity requirements. I think it would be great if they could work around the clients having to use a passport for the strong identity requirement as this has been the greatest issue we have faced so far. If they can't find a way around this, then dedicating more individuals on the ATO's end, the contact line, so it is not as much of a lengthy process when it needs to be done.

Gavan Ord:
Yeah, I think resourcing is really important from the ATO side. There needs to be more people answering the calls, trained up to answer those calls. We don't want situations where people call up and they're kicked out of the call, have to call up again. If they're running a business, that's time taken out of running their business.

Hannah Griffits CPA:
If they have to sit there on a phone for five hours and try and work it out, they're not going to really want to do it, are they? It's taking a huge part of their day.

Gavan Ord:
That's right. I think one of the first questions we asked was, that might just go, "Oh, this is all too difficult. I'll just stay with my current accountant."

Hannah Griffits CPA:
Yeah. Well, we have found a lot of clients have been doing that just said, "Oh, the process is too hard" and they sort throw their hands up in the air and say, "Oh, I'm just not going to do it." Which is not what we want obviously. We want them to be able to do it with ease. But hopefully the ATO can sort out some of the bugs they're having for the future.

Gavan Ord:
Thanks, Hannah. That's a great overview of client-agent linking. Now, let's get into some specific member questions we've had.

Jacqueline Blondell:
If you're this podcast, you should check out our in-depth business and finance show, INTHEBLACK. Search for INTHEBLACK on your favourite podcast app today. And now back to With Interest.

Gavan Ord:
So this member asks, "I have several potential clients who don't have a myGov account and they have no intention of having one due to various reasons. What options exist for such clients to link to their new agent?"

Hannah Griffits CPA:
So if a client is unable to set up their myGov, we as a practitioner can contact the ATO through a practise mail request and the ATO will then assist in the process of linking the client. In the request, you just have to state the client's name, their TSN or ABN and the reason why the client is unable to complete the nomination in the normal process. In doing this, you'll also confirm with the ATO that the client has provided you with adequate proof of identity requirements. It's probably going to be a longer process if we have to do it that way, but at least there is a backup option in case there is people that really dig their heels in.

Gavan Ord:
The next member question is as follows, "Most of my new clients struggle to link their ABNs to RAM." And RAM stands for... What does RAM stand for? Just remind the audience.

Hannah Griffits CPA:
Relationship Access Manager.

Gavan Ord:
"So most of my new clients struggle to link their ABN to RAM. When they finally do link, there can be further issues like only linking the activity statement account. Could you share your tips to make it easier for clients to link their ABN to their RAM and make sure the correct accounts are linked to you as the agent and also the client doesn't accidentally kick out their BAS agent if they use a BAS agent?"

Hannah Griffits CPA:
So that's a great question and it's one that we're coming across quite a bit. I think as I mentioned before, the first step is just making sure that the details on the ABR are up-to-date before we start the whole process because it will make it so much easier when we get to actually linking the client. I also think it's important to confirm with the client prior to the linking process exactly what links are needed, so whether you're going to be doing their BAS work for them or whether you're going to be doing your tax work. And then that way when you get to that step of the process, you can automatically know, "Okay, I'm only doing their tax side of it rather than clicking both." Because once you click both, you get rid of the BAS agent link.

Gavan Ord:
Yeah, that's an issue that predates client-agent linking as well, but it's definitely an issue. The next question, "We have multiple clients from not-for-profit foundations that have a corporate trustee and not an individual trustee. We often find that when they try to link their myGovID to the ABN of the not-for-profit, the ABN of the not-for-profit doesn't show. The client then needs to call the ATO to link to the ABN of the not-for-profit in RAM. Is there a better approach than having to make these phone calls?"

Hannah Griffits CPA:
Unfortunately, that's the only option that they have available at the moment. I know the ATO are aware that that is an issue. And hopefully they'll work through a process that will make this easier because we've had the same problems with SMSFs and trusts as well. So it does affect a large number of clients.

Gavan Ord:
And I know there's a lot of not-for-profits which may have set up their ABR and at the start of GST have never revisited their ABR since. It goes back to your point around keeping the ABR up-to-date.

Hannah Griffits CPA:
Yeah, definitely, because if you're starting off with the wrong details there, it's just going to make the process harder as you go along.

Gavan Ord:
Just one last question, Hannah. So what are your key tips that you would like listeners to take away from this programme? So what should they keep in front of mind when they try to do client-agent linking?

Hannah Griffits CPA:
I think I mentioned it a few times. I think it's very important that they have those details on the ABR up-to-date because that's just going to make the whole process easier. And then also I think agents speaking to their clients about client-agent linking in a positive note so that clients are going into it with a positive outlook.

Gavan Ord:
Thanks, Hannah. And thank you for those tips and explaining this important topic.

Hannah Griffits CPA:
Thanks, Gavan. I think it's important for tax agents to stay aware and be around this topic because it's very important at the moment.

Gavan Ord:
For more information about client-agent linking including links to additional resources and information on not-for-profits and bulk transfers, you can refer to the show notes for this episode. With Interest is a regular podcast. If you like today's show, you can subscribe on your favourite podcast app by searching for CPA Australia's With Interest. I'm Gavan Ord. Until next time, thanks for listening.

Garreth Hanley:
You've been listening to With Interest, a CPA Australia podcast. If you've enjoyed this episode, help others discover With Interest by leaving us a review and sharing this episode with colleagues, clients, or anyone else interested in the latest finance, business, and accounting news. To find out more about our other podcasts and CPA Australia, check the show notes for this episode. And we hope you can join us again for another episode of With Interest.