Which Services Actually Trigger the Obligation

The AML/CTF Tranche 2 reforms extend Australia's anti-money laundering framework to gatekeeper professions including accountants, lawyers, and real estate agents. From 1 July 2026, accounting firms that provide certain designated services are classified as reporting entities under the AML/CTF Act and must comply with the full regime.

The question most firms are asking is whether they are actually in scope. The answer depends on what services the firm provides, not on its size or revenue. AUSTRAC defines three main categories of designated services for accounting practices: forming or managing body corporates and legal arrangements, which includes setting up companies, trusts, and partnerships on behalf of clients; acting as or arranging for someone to act as a nominee director, trustee, partner, or nominee shareholder; and receiving, holding, or managing client funds in circumstances that go beyond holding funds solely as payment for services rendered.

The trust account point is one firms commonly misread. AUSTRAC has clarified that an exception applies when funds are held solely as payment for the firm's own services or incidentally to a non-designated service. Using a trust account as a substitute for a client's banking facility does not qualify for that exception. Firms that hold client funds in any capacity beyond straightforward payment collection need to assess that activity carefully before assuming they are not captured.

Pure compliance services, including tax return preparation, BAS lodgement, and bookkeeping where no entity formation or fund management occurs, do not on their own trigger the obligation. But many mid-size firms offer a broader service mix that includes company formations, trust deed preparation, nominee director arrangements, and succession structures. Each of those crosses into designated service territory.

What the AUSTRAC Starter Kit Actually Requires

AUSTRAC has published an Accounting Program Starter Kit specifically for Tranche 2 entities. It is designed for practices with 15 or fewer personnel that only provide professional services designated under the reforms, without also providing other categories of designated services such as financial services or gambling-related activities. Practices that fit that profile can use the Starter Kit as the foundation of their AML/CTF program with relatively modest tailoring.

The Starter Kit includes a risk assessment framework covering client types, services provided, and transaction patterns, along with template policies for customer due diligence, ongoing monitoring, suspicious matter reporting, staff training, and governance. Using it is not mandatory, but AUSTRAC actively encourages it for eligible small practices as a compliant baseline.

The practical steps the Starter Kit requires a firm to work through are: conducting a money laundering and terrorism financing risk assessment specific to the firm's services and client base, developing and documenting an AML/CTF program that reflects that assessment, appointing an AML/CTF compliance officer who meets AUSTRAC's fit and proper person requirements, implementing initial customer due diligence procedures before providing a designated service to a new client, setting up ongoing monitoring for existing client relationships, establishing a process for identifying and reporting suspicious matters to AUSTRAC, and ensuring staff are trained on AML/CTF risk awareness before obligations commence.

The program must be approved by senior management before 1 July 2026 and must be reviewed regularly as the firm's services and risk profile change.

The Enrolment Timeline and What Happens If You Miss It

Enrolment with AUSTRAC opened on 31 March 2026. Firms already providing designated services on 1 July 2026 must complete enrolment by 29 July 2026. Enrolment requires providing AUSTRAC with basic information about the firm's structure, the designated services it provides, key personnel, and contact details. If any of those details change after enrolment, AUSTRAC must be notified within 14 days.

Non-compliance carries real consequences. AUSTRAC has the authority to impose civil penalties and pursue criminal sanctions for breaches. The regime is not self-reporting in a way that allows firms to quietly assess whether they are in scope after the fact. From 1 July, the obligation exists by operation of law for any firm providing a designated service, regardless of whether that firm has enrolled.

The firms most at risk of missing this are those that provide company formations, trust structures, or nominee services as part of a broader advisory offering but have not historically thought of those services as financial crime-relevant. They are the same services AUSTRAC identifies as the ones most commonly exploited for money laundering by professional intermediaries. The obligation exists precisely because of that risk.

The Takeaway

If your firm sets up companies or trusts, acts as a nominee director, or holds client funds outside straightforward payment arrangements, you are likely a reporting entity from 1 July 2026. The practical checklist is: confirm whether you are in scope using AUSTRAC's designated services list, enrol via AUSTRAC's online portal, work through the Accounting Program Starter Kit to build your AML/CTF program, appoint a compliance officer, implement initial customer due diligence for new clients, and train relevant staff before obligations commence. The deadline is fixed by legislation and the window to act before it arrives is narrow.