AML/CTF Compliance for Accountants
Australia's Tranche 2 reforms bring accountants under the AML/CTF regime for the first time. If your practice manages client money, provides structuring advice, or creates legal arrangements, you are now a reporting entity with obligations to AUSTRAC. Enrolment deadline: 31 March 2026. Full compliance: 1 July 2026.
Key compliance deadlines
31 March 2026
AUSTRAC enrolment deadline for all Tranche 2 entities, including accountants providing designated services
1 July 2026
Full compliance required — AML/CTF program, KYC procedures, transaction monitoring, and reporting obligations all in effect
Contents
- 01Why accountants are now reporting entities
- 02Which accounting services are designated services
- 03Your six core AML/CTF obligations
- 04Common compliance challenges for accounting firms
- 05How IntelliCompli helps your practice comply
- 06Frequently asked questions
Why accountants are now reporting entities
Australia's Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 significantly expands the scope of the AML/CTF regime. For the first time, professional service providers — including accountants, lawyers, real estate agents, and conveyancers — are brought within the framework as reporting entities.
The rationale is straightforward: FATF (the Financial Action Task Force), the global AML/CTF standard-setter, has long identified professional services as a key vulnerability in the financial system. Criminals use accountants to structure transactions, create complex corporate arrangements, and move money in ways designed to obscure its origin. Australia's previous framework — which covered banks and financial institutions but not professional services — left a significant gap that this legislation closes.
FATF's mutual evaluation of Australia repeatedly flagged this gap. The 2024 amendments bring Australia into line with the UK, the EU, the US, and other major jurisdictions that already regulate professional services under AML/CTF frameworks.
Not every accounting service is regulated — the obligations attach to specific designated services. If your practice provides any of those services, you must enrol with AUSTRAC by 31 March 2026 and be fully compliant by 1 July 2026.
Relevant legislation
- AML/CTF Act 2006 — the primary legislation governing reporting entity obligations
- Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 — introduces Tranche 2 obligations
- AML/CTF Rules 2007 — detailed procedural requirements made under the Act
Which accounting services are designated services?
The AML/CTF Act regulates specific "designated services" — not entire professions. You need to assess whether your practice provides any of the following services. If it does, your obligations apply to those services (and to the clients you provide them to).
Managing client money or assets
Receiving, holding, or managing money or other assets on behalf of clients — including trust accounts, client funds accounts, and similar arrangements.
Financial advice involving transaction structuring
Advising clients on how to structure financial transactions, corporate structures, or arrangements in ways that affect the movement of money.
Creating or managing legal entities and arrangements
Establishing companies, trusts, partnerships, or other structures for clients, or acting as a nominee director, trustee, or partner.
Bookkeeping involving client funds
Providing bookkeeping services where you have the ability to direct or access client funds — not purely record-keeping where you have no access to funds.
Tax services involving management of financial flows
Providing registered tax agent services that extend to managing the movement of money to or from the ATO, clients, or third parties on behalf of the client.
Not sure if your services are designated?
AUSTRAC provides guidance on designated services. If you are uncertain whether your practice is covered, err on the side of enrolment — the cost of over-compliance is far lower than the cost of failing to comply. IntelliCompli includes a service mapping tool to help you identify your obligations.
Your six core AML/CTF obligations
Once enrolled with AUSTRAC, your practice must meet the following obligations. These apply regardless of the size of your firm — there is no small-business exemption under the AML/CTF Act.
Customer Identification (KYC)
Verify the identity of every client before providing a designated service. Collect name, date of birth, and address for individuals. For businesses, collect ABN/ACN, registered name, and beneficial ownership details.
AML/CTF Program
Maintain a written AML/CTF program with Part A (risk-based procedures) and Part B (customer identification). The program must be reviewed regularly and reflect the actual risks your practice faces.
Suspicious Matter Reporting
Lodge a Suspicious Matter Report (SMR) with AUSTRAC within 3 business days when you suspect a client or transaction is linked to money laundering, tax evasion, or other serious crimes.
Ongoing Due Diligence
Continuously monitor client relationships and transactions. Re-screen against sanctions and PEP lists when circumstances change. Apply enhanced due diligence to higher-risk clients.
Record Keeping
Retain all KYC records, transaction records, and reports for at least 7 years. Records must be retrievable promptly in response to an AUSTRAC request or law enforcement inquiry.
Annual Compliance Reporting
Submit an annual AML/CTF compliance report to AUSTRAC each calendar year. The report covers your compliance activities and any changes to your business or risk profile.
Common compliance challenges for accounting firms
Most accounting practices have never had to deal with AML/CTF obligations before. These are the challenges we hear most often — and how IntelliCompli addresses them.
No experience with AML/CTF programs or documentation
Program Builder with accounting-specific templates and guided editing
Hundreds of existing clients to screen before deadline
Bulk KYC verification with automated sanctions and PEP screening
Unsure which services are 'designated services'
Built-in service mapping tool to identify your obligations
Staff have no AML/CTF training
Interactive training modules with certificates for your compliance records
No time to build compliance from scratch before July 2026
Pre-built accounting firm templates — enrol and comply in days, not months
Uncertainty about ongoing SMR and reporting obligations
Automated alerts and guided SMR submission workflows
How IntelliCompli helps your accounting practice comply
IntelliCompli is designed specifically for Australian reporting entities, including Tranche 2 professional service providers. Our platform covers every aspect of AML/CTF compliance so you can meet your obligations without building a compliance function from scratch.
Program Builder
Build your AML/CTF program using accounting-firm-specific templates. Guided workflows for Part A and Part B, risk assessment, and policy documentation.
KYC & Identity Verification
Verify client identities digitally — individuals and businesses. Automated document verification and biometric checks at onboarding.
Sanctions & PEP Screening
Instant screening against OFAC, UN, EU, and Australian sanctions lists. Continuous monitoring so you're alerted when client status changes.
SMR Workflow
Guided Suspicious Matter Report creation and submission. Built-in tipping-off reminders to ensure you never inadvertently alert a client.
Staff Training
Interactive AML/CTF training modules tailored for accounting firm staff. Certificates issued for your compliance records.
Compliance Reporting
Automated annual compliance report preparation. Dashboard tracking so you always know your compliance status at a glance.
Frequently asked questions
Are accountants required to comply with AML/CTF laws in Australia?
Yes. The Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 brings accountants into Australia's AML/CTF regime as reporting entities for the first time. This applies to accountants who provide designated services such as managing client money, providing financial advice related to structuring, or acting as a nominee for clients. Full compliance is required by 1 July 2026.
What is the AUSTRAC enrolment deadline for accountants?
Accountants providing designated services must enrol with AUSTRAC by 31 March 2026. Enrolment is separate from full compliance — you must enrol first, then build your AML/CTF program. Full compliance with all obligations (AML/CTF program, KYC, transaction monitoring, reporting) is required by 1 July 2026.
Which accounting services are designated services under Tranche 2?
Designated services for accountants include: managing client money or assets, providing bookkeeping services where you handle client funds, advising on the structuring of financial transactions or entities, creating or managing legal arrangements such as trusts, and acting as a registered tax agent where services involve managing financial flows. Not all accounting work is covered — the focus is on services that could be used to move or conceal money.
What AML/CTF obligations must accountants meet?
Once enrolled with AUSTRAC, accountants must: maintain a written AML/CTF program; identify and verify clients (KYC) before providing designated services; conduct ongoing due diligence; monitor for suspicious activity; lodge Suspicious Matter Reports (SMRs) when required; submit annual compliance reports; and keep records for at least 7 years. A designated AML/CTF compliance officer must also be appointed.
Do sole trader accountants need to comply?
Yes. There is no exemption for sole traders or small practices. Any accountant who provides designated services must enrol with AUSTRAC and comply with the AML/CTF Act regardless of business size. The complexity of your AML/CTF program can be proportionate to the risks your practice faces, but the obligations themselves apply equally.
What are the penalties for accountants who don't comply?
AUSTRAC can impose civil penalties of up to $22.2 million per contravention for companies, and significant penalties for individuals. Serious or systematic non-compliance can result in criminal prosecution. Failing to enrol by 31 March 2026 is itself a breach. AUSTRAC has demonstrated willingness to take enforcement action — the $1.3 billion Westpac penalty in 2020 being the most prominent example.
How long does it take to build an AML/CTF program for an accounting firm?
A compliant AML/CTF program typically takes 2–6 weeks to build from scratch, depending on the size and complexity of your practice. It requires a risk assessment, documented policies and procedures, a client identification procedure (KYC), and staff training. IntelliCompli's Program Builder uses industry-specific templates for accounting firms, reducing build time to days rather than weeks.
Can accountants use client legal privilege to avoid AML/CTF reporting?
Client legal privilege does not apply to accountants — it is a protection available to lawyers. Accountants cannot use privilege to withhold information from AUSTRAC or avoid lodging Suspicious Matter Reports. If you suspect a client transaction is connected to money laundering or another serious crime, you are legally required to file an SMR. Importantly, you are prohibited from telling the client you have done so (tipping-off provisions).
Related guides
Tranche 2 Reform Overview
Everything you need to know about Australia's 2024 AML/CTF amendments and what they mean for professional services.
Complete AML/CTF Compliance Guide
The six core obligations every reporting entity must meet — from AUSTRAC registration to annual reporting.
Customer Due Diligence
How to conduct standard, simplified, and enhanced due diligence on your clients.
KYC Verification
Identity verification requirements for individuals and businesses under the AML/CTF Rules.
Ready to get your accounting practice compliant?
IntelliCompli makes AML/CTF compliance straightforward for accountants. Build your program, verify clients, and meet your AUSTRAC obligations — all in one platform.