Do bookkeepers need professional indemnity insurance?

Key points

• The Tax Practitioners Board's own examples put bank reconciliations on one side of the line and payroll that applies a taxation law on the other.
• Charging for BAS work while unregistered can cost an individual up to $91,000, the maximum civil penalty. Advertising it is a separate breach.
• A registered BAS agent's minimum aggregate cover is $250,000, $500,000 or $1,000,000, set by turnover excluding GST.
• Work under a registered tax or BAS agent's instruction and supervision, and neither registration nor the insurance requirement applies to you.

Is what you do a BAS service?

The insurance follows the registration, and the registration follows the work.

A BAS service is work that requires you to interpret or apply a BAS provision, rather than just record what someone else decided. The Tax Practitioners Board's own examples fall on both sides of that line.

Generally not a BAS service:

• Performing bank reconciliations.
• Entering data without involvement in or calculation of the figures on a client's activity statement.
• Data entry through processes that do not require interpreting or applying a taxation law or a BAS provision.
• Coding tax invoices and transferring data under the instruction and supervision of a registered agent.
• Installing accounting software without setting client-tailored GST codes.
• General classroom training on accounting software.

Generally a BAS service:

• Coding transactions and transferring data where the process requires interpreting or applying a BAS provision.
• Providing a payroll service that interprets or applies a taxation law, including set-up or reporting through Single Touch Payroll enabled software.
• Confirming the figures to be included on an activity statement.
• Advising on or registering a client for GST, PAYG withholding or fringe benefits tax.
• Calculating leave payments and the associated withholding.

The line between the two lists is not always obvious in a live client relationship, which is where most of the exposure actually sits.

If your work lands on the second list and you charge for it, you need registration first, then the cover: professional indemnity for accountants, bookkeepers, tax agents and BAS agents.

What does charging for BAS work without registering cost?

Charging is what bites, not the insurance. Under the Tax Agent Services Act, providing a service you know or ought reasonably to know is a BAS service, for a fee or other reward, while not registered, is a civil penalty contravention. The maximum is 250 penalty units for an individual and 1,250 for a body corporate, which at the current penalty unit is up to $91,000 and $455,000.

Advertising that you will provide BAS services while unregistered is a separate contravention, at a maximum of 50 penalty units for an individual and 250 for a body corporate, so up to $18,200 and $91,000. That means a website or an ad can breach the Act before a single client is served.

The penalty unit is $364 from 01/07/2026 and is indexed, so those dollar figures move with it.

How much professional indemnity insurance does a BAS agent need?

The Tax Agent Services Act makes professional indemnity that meets the Board's requirements a condition of being registered and of renewing, and a standing obligation for as long as you are registered.

BAS agents sit on the same turnover-banded table as tax agents. The minimum aggregate cover depends on turnover excluding GST:

• Up to $75,000 of turnover: $250,000.
• $75,001 to $500,000: $500,000.
• Over $500,000: $1,000,000.

The Board's other conditions, on defence costs, the excess and the retroactive date, are set out on our page for professional indemnity for accountants and bookkeepers, with the professional body rules that can set a higher minimum.

Can you work under a registered agent instead?

Yes. Working under the instruction and supervision of a registered tax or BAS agent is the other lawful route, and it keeps a bookkeeper outside both the registration requirement and the insurance requirement that follows it.

Why might a bookkeeper need professional indemnity insurance anyway?

A bookkeeper who is not registered and does not need to be still faces the ordinary commercial reasons for holding cover: client engagement terms, software partner programs, association membership and the plain fact that a payroll or reconciliation error can cost a client real money and generate a real claim.

Two other risks sit beside the advice risk. Injury and property damage claims, which professional indemnity does not answer, sit with public liability insurance. Client data is a different policy again: cyber insurance.

Not sure which side of the line your work sits?

Tell us what you do for your clients, whether you charge for it and whether you are registered. We start with what the work actually involves, then set your cover to match.

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