Anti-Money Laundering Checks: What Australia's New Rules Mean for Accounting Clients
From 1 July 2026, new laws will change how every accounting practice in Australia works with their clients. The Australian Government is expanding its anti-money laundering and counter-terrorism financing laws to cover accountants, lawyers, real estate agents, and other professionals who handle transactions and structures on behalf of their clients. AUSTRAC, the government agency that oversees financial crime prevention, calls these "gatekeeper professions," and from 1 July 2026, they'll be regulated in the same way banks have been for years.
The reforms were passed into law on 10 December 2024 and take effect on 1 July 2026. Accounting firms are required to enrol with AUSTRAC as a reporting entity, with enrolment opening from 31 March 2026.
In plain terms, accounting firms now have a legal obligation to verify who they're working with before they can assist with certain types of work. Understanding what that means in practice will help things run smoothly when the time comes.
Which Services Require Anti-Money Laundering Checks
Australia's AML/CTF laws will apply to specific services provided by accountants, what the legislation calls "designated services." These are the types of work that AUSTRAC has identified as carrying a higher risk of being misused for money laundering or terrorism financing. If an accounting firm provides one of these services, identity verification and due diligence checks must be completed before the work can begin.
The designated services that apply to accountants relate specifically to transactional and structuring work. In practical terms, these include:
Setting up a new company, trust, partnership, or other legal entity
Restructuring an existing entity, including changing directors, amending trust deeds, or converting structures
Assisting with real estate transactions, including purchases, sales, or transfers
Managing or holding client funds in connection with a transaction
Arranging equity or debt financing for an entity
Acting as, or arranging, a director, secretary, trustee, or nominee shareholder on your behalf
Providing a registered office or business address for an entity
The following services not included in the the new laws:
Preparing and lodging your tax return
BAS preparation and lodgement
Bookkeeping, payroll, and day-to-day accounting
General business advisory not linked to a specific transaction
Financial statement preparation, audit, and assurance work
General tax planning advice, discussing options without actually creating structures
AUSTRAC draws a clear line between advising and assisting. Giving general advice about the pros and cons of a particular structure doesn't trigger AML obligations. But the moment an accountant starts directly advancing a transaction, drafting documents, registering entities, executing transfers, the requirements kick in.
If you're unsure which side of that line your services fall on, it's worth checking with your accountant before assuming.
What the Identity Verification Process Involves
If there's one thing that will determine whether the new AML process is quick and painless or slow and frustrating, it's whether the necessary documents are available when the time comes.
The good news is that most of what's required is information that already exists. Key documents like trust deeds, company constitutions, ASIC extracts, and entity records may already be on file with your accountant. Where that's the case, they'll pull together what they already have and only come to you for anything that's missing or needs updating.
Here's what's typically required, based on your situation.
What everyone needs:
Current photo ID, driver's licence or passport for every key individual
Date of birth and residential address
Up-to-date contact details, including legal name, trading name, phone, email, and postal address
Tax File Number and ABN or ACN, where relevant
If you operate through a company:
Recent ASIC company extract showing directors, shareholders, registered office, and share structure
Beneficial ownership details for anyone who owns or controls 25% or more, directly or indirectly
Group structure chart if there are holding companies, related entities, or overseas parents
Photo ID for each director and each beneficial owner
If you operate through a trust or SMSF:
Trust deed and any amending deeds
Names and details of trustees, appointor, and beneficiaries or classes of beneficiaries
For SMSFs: latest ATO registration notice and complete list of members
Photo ID for all trustees and key individuals
Depending on your risk profile, your accountant may also request source of funds, source of wealth, the purpose of the engagement or transaction, or a Politically Exposed Person (PEP) declaration. These questions aren't accusations. They're standard risk-assessment tools that the legislation requires when circumstances call for it.
What Happens If Verification Can't Be Completed
This is the part that catches people off guard. Under the new laws, accounting firms are legally prohibited from providing a designated service until identity verification and due diligence are complete. It doesn't matter how long you've been a client. It doesn't matter how straightforward the work is. If the checks aren't done, the work can't start.
If an accounting firm can't verify your identity, they may need to limit the services they can offer you. The fastest way to avoid that outcome is to get your details in order early.
Two Reporting Obligations Every Client Should Know
Accounting firms operating as reporting entities under the AML/CTF Act carry two specific obligations every client should understand.
Threshold Transaction Reports: Any transaction involving $10,000 or more in physical cash must be reported to AUSTRAC. This applies automatically, regardless of the nature or legitimacy of the transaction.
Suspicious Matter Reports: If an accounting firm forms a suspicion that a transaction or activity may be related to money laundering, terrorism financing, or another serious crime, they must file a confidential report with AUSTRAC. Under what's known as the "tipping off" prohibition, they're legally prevented from disclosing that a report has been filed or is under consideration. Breaching this is a criminal offence. Banks file thousands of these reports each year, and the existence of a report doesn't indicate that anything illegal has occurred.
How Your Information Is Protected
Everything collected under the AML/CTF laws is used strictly for compliance with legal obligations. That means verifying your identity, assessing risks, conducting due diligence, and meeting reporting requirements.
It will not be used for marketing. It will not be shared with business partners or sold to third parties. It will not be used for any purpose beyond what the AML/CTF legislation specifically requires. Your information is handled in accordance with the Australian Privacy Principles, and accounting firms are legally obligated to keep it secure.
Under the AML/CTF Act, records must be retained, including identification documents, due diligence records, risk assessments, and any reports filed, for a minimum of seven years.
What This Means if You're Already a Client
If you were a client of an accounting firm before 1 July 2026, you're considered a "pre-commencement customer." No immediate action is required. The due diligence process is triggered when you request a new designated service, for example, if you ask your accountant to set up a new trust, restructure a company, or assist with a property transaction.
You don't need to rush out and gather everything right now. AML checks are triggered when you request a designated service, not before. The main thing you can do to keep things moving is make sure your photo ID is current and your contact details are up to date. Those are the items least likely to already be on file.
How Cordner Advisory Can Help
When you do need a designated service, your Cordner Advisory Client Manager will guide you through the process at that time. In many cases, we may already have key documents like your trust deed, company constitution, or ASIC records on file, so the process may be quicker than you expect.
If you'd like to get ahead of the process, the most useful thing you can do is make sure your photo ID is current and your contact details are up to date. Beyond that, we'll handle it when the time comes. Get in touch with your Client Manager, and we'll walk you through it.