Why We’re Asking You to Verify Your Identity: New AML Rules for Accounting Firms
If you’ve worked with our firm before, you might notice something different next time we set up a trust or company for you, or handle certain transactions on your behalf: we’ll be asking for photo ID, some extra details, and possibly a few follow-up questions we haven’t needed before.
This isn’t a new sales tactic, and it isn’t because we’ve forgotten who you are. It’s because of new anti-money laundering laws that now apply to accounting firms, and we wanted to explain exactly what’s changed and why.
What’s actually changed
Australia has had anti-money laundering and counter-terrorism financing (AML/CTF) laws for years, but until now they’ve only applied to banks, financial institutions and a handful of other regulated businesses. Accountants, along with lawyers, real estate agents and a few other professions, sat outside that regime entirely.
That changed on 1 July 2026, when a set of reforms known as “Tranche 2” came into effect. These reforms bring accountants under the same AML/CTF laws that banks have followed for years, when we provide certain types of services. The regulator overseeing all of this is AUSTRAC — the Australian Transaction Reports and Analysis Centre.
Why accountants, specifically?
The honest answer: because professions like ours can be misused to move or disguise money, sometimes without the adviser ever realising it. Setting up a company or trust, managing client funds, or advising on significant transactions are all legitimate, everyday parts of what accountants do — but they’re also exactly the kind of services that can be exploited to launder money or hide the source of funds.
Australia has also been under pressure to bring its laws into line with international standards set by the Financial Action Task Force (FATF), the global body that sets the benchmark for fighting financial crime. We’d been an outlier among comparable countries for some time, so this reform has been on the horizon for a while.
Does this apply to everything we do for you?
No — and this is the part most people get wrong. Tranche 2 only applies to specific “designated services,” not to accounting generally. For most of our clients, day-to-day work like preparing tax returns, standard bookkeeping and routine advisory won’t trigger any of this.
Where it does apply is things like:
- Helping set up or manage a company or trust
- Managing client money or assets as part of certain services
- Acting as a registered business address for the client
- A handful of other specific professional services set out in the legislation
If any of your work with us falls into these categories, that’s when you’ll notice the new steps.
What you’ll actually be asked to do
In practice, it’s fairly simple. When a designated service applies, we’ll need to:
- Verify your identity — usually a driver’s licence, passport or similar photo ID
- Understand who’s really behind a business or trust — if you’re a director, trustee or beneficial owner of an entity, we may need details about the structure and the people who control it
- Ask a few extra questions during onboarding — nothing invasive, just enough to meet our legal obligations
- Occasionally follow up — if your circumstances change significantly, we may need to check in and refresh some of these details down the track
None of this is a reflection on you personally. Every firm providing these services has to apply the same checks to every client, consistently — that consistency is actually the point of the law.
What it means for us as a firm
Behind the scenes, this has meant a fair bit of work on our end too. We’ve had to:
- Register with AUSTRAC as a reporting entity
- Appoint a compliance officer to oversee our AML/CTF obligations
- Build a risk-based compliance program and update our onboarding processes
- Train our team so these checks are handled properly and consistently
We’ve done this deliberately and early, because we’d rather get it right than scramble at the last minute — and because, frankly, we think proper process protects our clients as much as it protects us.
What this doesn’t mean
To be clear about what this isn’t:
- It isn’t a sign we suspect you of anything
- It doesn’t mean we’re sharing your personal information more widely than before — your identification documents are handled under strict privacy obligations, and there are now specific rules about how long that information can be kept and how it must be stored
- It doesn’t apply to every interaction — most routine tax and compliance work is unaffected
What you can do to make it easy
If you’re setting up a trust, forming a company, or engaging us for a service that involves managing funds on your behalf, you can speed things along by:
- Having a current photo ID ready (driver’s licence or passport)
- Being prepared to explain the ownership or control structure of any entity involved
- Answering our onboarding questions promptly — the sooner we have what we need, the sooner we can get on with the actual work
Any questions?
We know a new layer of paperwork is never anyone’s favourite thing, and we’ve tried to keep our process as light-touch as the law allows. If you’re ever unsure why we’re asking for something, just ask us directly — we’re always happy to explain.
If you’re setting up a new structure or starting a new engagement with us and want to know upfront what documentation you’ll need, get in touch and we’ll walk you through it.