AML Reforms in Australia: What accounting firms need to know in 2026

Australia is undergoing one of the most significant regulatory shifts in decades with the expansion of its Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime. From 1 July 2026, accounting firms providing certain services will be brought into the AML/CTF framework under the so-called “Tranche 2” reforms.

These changes aim to align Australia with global standards and close long-standing gaps that allowed professional service providers - such as accountants, lawyers, conveyancers, trust and company service providers - to potentially be unwittingly used in facilitating financial crime or, far worse still, intentionally facilitate it.

Historically, Australia’s AML/CTF laws applied mainly to banks, financial institutions and gambling providers. However, global bodies such as the Financial Action Task Force (FATF) have pushed for broader coverage of “designated non-financial businesses and professions,” including accountants. 

Accountants are considered high-risk intermediaries because they often:

• Structure companies and trusts
• Manage client funds
• Facilitate transactions or asset transfers

These services can be exploited to disguise illicit funds or conceal beneficial ownership.

What’s changing: Key AML rules for accountants

Practical impact on accounting firms

Increased compliance burden
Most accounting firms, potentially 80–90% of practitioners, will be affected. 

This means:

• More documentation and administrative work
• Changes to onboarding processes
• Increased scrutiny of client relationships

Operational changes
Firms will need to:

• Implement new systems and controls
• Integrate AML checks into workflows
• Possibly adopt compliance technology

Risk and penalties
Failure to comply may result in:

• Regulatory penalties
• Reputational damage
• Increased audit and oversight

Opportunities from the reforms

While burdensome, the reforms also:

• Enhance trust in the profession
• Align Australian firms with global standards
• Reduce exposure to financial crime risks

How firms should prepare

Preparing for AML/CTF obligations is not just a compliance exercise; it requires operational, cultural, and systems changes. Below are practical steps firms can take now to get ready before July 2026.

To get ready:

1. Assess whether you provide designated services
2. Register early with AUSTRAC
3. Develop an AML/CTF program
4. Train staff and appoint a compliance officer
5. Review client onboarding and risk processes

Practical steps:

Practical impact on the clients of accounting firms

The expansion of Australia’s AML/CTF regime to accounting firms will not only transform how firms operate, it will also have a direct and noticeable impact on their clients. From onboarding to ongoing engagements, clients will experience increased scrutiny, new information requirements, and changes in how services are delivered.

1. More documentation and identity checks

Clients will be required to provide more detailed personal and business information than before.

This includes:
•    Proof of identity (e.g. passport, driver’s licence)
•    Verification of company ownership structures
•    Disclosure of beneficial owners

For some clients, particularly those with complex structures, this may feel intrusive or repetitive.

Impact: Longer onboarding times and increased administrative effort for clients.

2. Greater transparency expectations

Clients will need to be more transparent about:
•    Source of funds and wealth
•    Purpose of transactions
•    Business activities and structures

Accountants may ask more probing questions, especially where transactions appear unusual or high-risk.

Impact: Clients may need to justify decisions that were previously taken at face value.

3. Delays in service delivery

With additional compliance steps built into workflows, clients may experience:
•    Slower onboarding
•    Delays in executing transactions or setting up entities
•    Additional review steps before advice is provided

Impact: Time-sensitive transactions may require earlier planning and coordination.

4. Increased costs

Compliance obligations will increase operational costs for accounting firms, which may be passed on to clients through:
•    Higher fees
•    Separate compliance or onboarding charges

Impact: Clients may see a rise in the cost of professional services.

5. Ongoing monitoring and follow-ups

Clients will no longer be assessed only at onboarding, firms will conduct ongoing monitoring.

This means clients may:
•    Be asked to update their information periodically
•    Receive queries about transactions or changes in structure
•    Undergo re-verification if risk profiles change

Impact: The client-accountant relationship becomes more continuous and compliance-driven.

6. Reduced anonymity in financial structures

AML rules focus heavily on identifying beneficial ownership, reducing the ability to use opaque structures.

Clients using the following, will face increased scrutiny:
•    Trusts
•    Layered entities
•    Offshore arrangements

Impact: Less flexibility for clients seeking privacy in structuring (legitimate or otherwise).

7. Potential refusal or termination of services

Accounting firms will be required to decline or disengage from high-risk clients where risks cannot be managed.

This may occur if:
•    Clients refuse to provide required information
•    Activities appear suspicious
•    Risk levels exceed firm tolerance

Impact: Some clients may find it harder to access accounting or advisory services.

8. Shift in client experience and expectations

Overall, clients will notice a shift from a purely advisory relationship to one that includes regulatory oversight responsibilities.

Accountants will act not only as advisors, but also as:
•    Gatekeepers of financial integrity
•    Obligated reporters to AUSTRAC

Impact: Clients may need to adjust expectations around confidentiality and responsiveness.

Key takeaway 

Firms that succeed will treat AML not as a regulatory burden, but as a process redesign exercise. The goal is to embed compliance into everyday workflows, especially onboarding, rather than layering it on top.

The AML/CTF Tranche 2 reforms represent a major shift for the accounting profession in Australia. By extending regulatory oversight to accounting firms, the government aims to strengthen financial integrity and combat illicit activities more effectively.
For accounting firms, early preparation will be critical, not only to ensure compliance but to integrate these obligations efficiently into business operations.

Enrolment with AUSTRAC is not a one-off administrative step, it marks the point at which accounting firms enter an ongoing regulatory regime involving continuous monitoring, reporting, and compliance obligations.

For clients, the key to navigating this new environment will be preparedness, transparency, and early engagement with their advisors.