Legal Practices

What this means for your firm

From 1 July 2026, a legal practice carries AML/CTF obligations for the specific services it provides that the Act lists. Acting for a client on a property transaction, forming a company or trust, or acting as trustee are among them. Advising a client on the legal effect of a contract is not.

The line between advising and doing comes up more in legal practice than in any other vertical, because so much of what a practice does is advice. Advice alone does not bring you into scope, but doing one of the listed things does.

For the general test, see Obligations overview.

Which services are designated services

Tick the services your firm provides to see which ones are designated services. The detail for each item follows below.

Step 1 of 2

Which of these services do you provide?

Tick everything your business does, including work you think is out of scope.

Property

Act for a buyer or seller in a property sale or transfer, such as conveyancing, contracts or settlement

Companies, trusts and structures

Set up companies or trusts for clients, or change their legal structure, for example a merger or demergerHelp a client buy, sell or transfer a company or trust, including its shares or unitsHelp a company or trust raise equity or debt finance, such as a capital raising or business loanSell or transfer shelf companiesAct as a company director, secretary or partner on a client's behalf, or arrange for someone else toAct as trustee of a trust for a client, or arrange for someone else toHold a power of attorney on behalf of a clientAct as a nominee shareholder for a client, or arrange for someone else toProvide a registered office or business address for a client

Client money

Hold client money in your trust account, or receive money from clients and pay it out on their behalf

Other work

Prepare tax returns or give tax adviceLitigation, dispute resolution or court representationDraft wills, including testamentary trustsCertify documents, witness signatures or administer oathsAdvise on the legal effect of a contract, without acting in the transaction

Legal services fall under Table 6 in s 6(5B) of the AML/CTF Act 2006, the professional services table. It has nine items. Table 6 is profession neutral: it captures the service, not the job title, so it applies to solicitors, barristers and notaries on the same terms as anyone else who provides the service.

Three conditions apply to every item:

• In the course of carrying on a business: a service you provide only once, or for free to further the practice, still counts. Pro bono work is not excluded for that reason alone.
• An external customer: a service you provide to another member of your own business group is not a designated service (s 6(6A)).
• A geographical link to Australia: broadly, the service is provided through a permanent establishment in Australia, or by an Australian resident, or a subsidiary of an Australian resident company, through a permanent establishment overseas (s 6(6)).

How to tell whether a service counts

For items 1 to 4 and 6, AUSTRAC asks whether your work is sufficiently linked to the outcome the item describes. Being connected to a transaction is not enough. Your work has to take active steps that move it forward. Two principles decide it:

• Who: a person whose assistance to a customer directly advances the transaction, or the creation or restructure of the entity. Merely influencing how the customer proceeds, giving general advice, or providing ancillary services is not sufficient.
• When: the service starts when you act on instructions and directly advance the transaction. That is typically once two or more parties to a transaction exist, or when preparatory steps are taken to create or restructure a body corporate or legal arrangement.

"Planning" and "organising" extend to preparatory steps that directly advance the outcome, such as preparing a contract for sale once the seller and buyer have agreed a price. Hypothetical or remote outcomes do not count. The items also look forward: they apply to matters in progress or still to happen, so advice on whether a completed transaction or incorporation was lawful is not a designated service.

AUSTRAC's contrast between advice and doing appears in its own example: a conveyancer engaged to transfer real property provides item 1, while a solicitor engaged only to advise that conveyancer on the legal effect of terms in the contract for sale does not.

AUSTRAC's worked example: instructing a solicitor

A financial adviser helps a client set up a self-managed super fund. The adviser explains the steps, recommends a solicitor, instructs the solicitor to set up the trust, then reviews the deed and helps with rollover and investment forms.

AUSTRAC's view is that the adviser does not provide a Table 6 service, because that work influenced the creation of the trust without directly advancing it. The solicitor who drafts the trust deed and has it executed provides item 6, from the point they accept the client's instruction and act on it.

The nine items, with legal examples

The descriptions paraphrase s 6(5B). The customer is the person you assist unless the text below says otherwise.

Item	What it covers	Examples for legal practices	Not covered
1	Assisting in, or acting in, a transaction to sell, buy or transfer real estate	Conveyancing for a buyer or seller, including a transfer for no consideration	Advice on contract terms to another conveyancer; transfers under a court or tribunal order
2	Assisting in, or acting in, a transaction to sell, buy or transfer a body corporate or legal arrangement	Acting on a share sale or the transfer of a trust: negotiating, sale contracts, due diligence	Advice before a transaction exists; non-controlling interests; transfers under a court or tribunal order
3	Receiving, holding and controlling (including disbursing), or managing, a client's money or other property as part of a transaction	Holding and releasing escrow funds for a client's commercial transaction	Money payable under a court order; bail, filing fees and insurer payouts; the s 6(5C) cases below
4	Assisting in organising, planning or executing equity or debt financing for a body corporate or legal arrangement, existing or proposed	Negotiating and drafting finance documents for a client company's raising or loan	General advice on financing options
5	Selling or transferring a shelf company (customer: the buyer or transferee)	Selling a registered company that has not traded	Registering a new company, which is item 6
6	Assisting in, or acting in, the creation or restructuring of a body corporate or legal arrangement	Company constitutions, shareholders agreements, trust deeds, partnership agreements, mergers and demergers	Wills and testamentary trusts; advice after creation on whether it was lawful
7	Acting as, or arranging for someone to act as, a director or secretary, a partner, a trustee of an express trust, or a power of attorney of a body corporate or legal arrangement, on a client's behalf (customer: the nominator)	Acting as trustee of a client's express trust; preparing a power of attorney for a company or trust	Power of attorney for an individual; executor or trustee of a testamentary trust; court-appointed roles
8	Acting as, or arranging for someone to act as, a nominee shareholder (customer: the nominator)	Holding shares for a client and voting on its instructions	Shares held other than on behalf of a nominator
9	Providing a registered office address or principal place of business address of a body corporate or legal arrangement	Letting a client entity use the practice's address as its registered office while it operates elsewhere	The address a business operates from

Conveyancing (item 1)

Item 1 covers "assisting a person in the planning or execution of a transaction, or otherwise acting for or on behalf of a person in a transaction, to sell, buy or otherwise transfer real estate". Your customer is your own client. Unlike a real estate agent under Table 5, you do not take on the other party as a customer.

AUSTRAC lists the typical conveyancing steps as part of the service: preparing, reviewing or lodging the contract of sale and transfer instrument; researching titles, strata documents and land use; dealing with financial institutions on payments and mortgage discharge; holding a buyer's funds and disbursing trust funds at settlement, or arranging release of the deposit; preparing for financial settlement; and preparing registry documents.

The service starts when you act on instructions and a transaction exists, meaning at least one buyer and one seller. In a private treaty sale, or an auction that does not meet reserve, that is when the buyer and seller agree the price, verbally or in writing. At an auction that meets reserve, it is when the buyer is successful. Drafting a contract before either point is not yet the designated service.

Real estate includes fee simple, leases of more than 30 years (not counting options) and land use entitlements, and a transfer counts whether or not anything is paid. A lawyer helping a parent transfer the family home to their child for no consideration provides item 1. The full definition of real estate, and what it excludes, is on Real estate.

Holding and disbursing settlement funds within the conveyance is part of item 1, not a separate item 3 service, because s 6(5C)(e) excludes item 3 where the conduct is another designated service.

Family law and litigation

Litigation generally falls outside Table 6. It does not directly advance a transaction, and it usually concerns matters that have already happened. AUSTRAC's family law example shows where the line sits:

• Advising a client on property bought during the marriage is not item 1, because the only transaction (the original purchase) is complete.
• Drafting consent orders that provide for a property transfer is not item 1 either. It determines the parties' rights and only influences a possible later conveyance.
• If the court makes the order, the conveyance that gives effect to it is excluded from item 1.
• If the parties instead sign a binding financial agreement, drafting the agreement is not regulated, but conveyancing the property under it is item 1.

Entities and trusts (items 2, 4, 6, 7 and 8)

Commercial work meets items 2, 4 and 6 in the same way it does for any adviser. The service starts when you accept instructions and act to advance the transaction or the creation, and preparatory drafting and negotiation are part of it.

For item 6, the customer is the person who instructs you and, where you are creating a company, its beneficial owners and directors, or where you are creating an express trust, its trustee, settlor and beneficiaries. An express trust is one "expressly and intentionally created in writing by a settlor" and does not include a testamentary trust (s 5), so drafting a will is not item 6. "Restructuring" means changing the entity's legal form, for example through a merger or demerger.

Items 7 and 8 cover acting as, or arranging for someone to act as, one of the listed roles on a client's behalf. Arranging includes drafting the appointment documents and identifying or introducing the person to be appointed. Item 7 does not apply to a power of attorney for an individual, to trustees or executors of testamentary trusts, to trustees of trusts not created in writing, to fiduciary roles under a court or tribunal order (s 6(5E)(a)), or to acting as trustee of a regulated debtor's estate (s 6(5E)(b)). An ordinary agent-principal relationship, where you act on instructions without taking on control, authority or fiduciary responsibility equivalent to the listed roles, is not item 7.

AUSTRAC's notary example applies to any practitioner. Certifying documents, preparing notarial certificates, and administering oaths or powers of attorney for individuals are not designated services. Drafting a contract for the sale of real estate (item 1) or preparing a power of attorney for a body corporate or legal arrangement (item 7) is.

Trust money (item 3)

Item 3 covers receiving, holding and controlling (including disbursing) a client's money, accounts, securities, virtual assets or other property, or managing them with authority and discretion, "as part of assisting the person in the planning or execution of a transaction". It applies only where your handling of the money directly advances the transaction and no s 6(5C) exclusion applies. The customer is your client, not a counterparty whose money passes through your trust account.

Under s 6(5C), item 3 does not apply where:

• (a) the money is payment for your own services
• (b) the practice provides no designated service other than item 3, and the money is for payments reasonably incidental to a service that is not a designated service
• (c) the money is received or payable under a court or tribunal order
• (d) it is a payment to or from a government body, a court or tribunal, a public international organisation or a licensed insurer (s 6(5D)), such as court filing fees, bail paid through your trust account, ATO payments or insurance compensation
• (e) the conduct is another designated service, such as settlement funds in a conveyance you act on
• (f) the Rules specify the circumstance.

AUSTRAC's example for paragraph (b) is a litigation-only practice that holds settlement funds in escrow under privately negotiated settlements: the handling is incidental to litigation, so the exclusion is likely to apply. Paragraph (b) works at the level of the whole entity, across all practice areas. If the same practice also does conveyancing, the exclusion is not available and the settlement funds have to be assessed under item 3 on their facts.

Your professional conduct rules on trust accounts and the AML/CTF regime are separate obligations. Meeting one does not meet the other.

Exemptions and edge cases

• Barristers briefed by a solicitor: a service provided by a barrister, in the course of practice as a barrister, on a solicitor's instructions given in connection with a designated service is not a designated service (s 6(6B)). The solicitor's own service still is.
• Barristers acting for Australian government bodies: the Act does not apply to any Table 6 service a barrister provides to an Australian government body (AML/CTF (Class Exemptions and Other Matters) Rules 2007, the Class Exemptions Rules, Chapter 7).
• Legal assistance sector: the Act does not apply to item 1, 3 or 4 services that are incidental to legal services which are not designated services, where the service is provided by a community legal centre accredited under the National Accreditation Scheme of Community Legal Centres Australia, by an Aboriginal and Torres Strait Islander Legal Service or Family Violence Prevention and Legal Service funded under the National Access to Justice Partnership, or by or paid for by a legal aid commission, including through a grant of legal aid (Class Exemptions Rules, para 9.1). Items 2 and 5 to 9 are not covered by this exemption.
• Duty lawyers and court referrals: the Act does not apply to any Table 6 service provided as a duty lawyer or advocate at a court or tribunal, or because of a referral for legal assistance by a court or tribunal (Class Exemptions Rules, para 9.2).
• Court and tribunal orders (items 1 and 2 only): a transaction "pursuant to, or resulting from" an order is excluded, for example a transfer from a deceased estate after a grant of probate or letters of administration, or under family law consent orders. The exclusion covers work after the order is made, not work to obtain it. There is no equivalent for items 3 to 9, apart from the court-order limbs in s 6(5C)(c) and s 6(5E)(a).
• The when test: the service starts when you act on instructions and directly advance the outcome, not at the first advice. A matter can begin as advice and become a designated service partway through, for example when a buyer and seller agree a price.

An exempt provider acting outside the exempt capacity may still be in scope. Check each exemption's conditions against the services the practice provides rather than treating the practice as exempt as a whole.

AUSTRAC guidance used for this section:

• Professional designated services
• Exemptions from AML/CTF obligations
• Legal profession program starter kit: getting started

What to watch for in legal practice

The dual service model

Legal practitioners have a dual service model. Conveyancing under item 1 and the other professional services under items 2 to 9 are treated separately. They require separate risk assessments, and they have different CDD timing rules.

AUSTRAC's starter kit for this vertical is built around that split, with service-specific forms for conveyancing and for other professional services.

The item 1 timing differs from the rest

Because conveyancing is treated separately, the delayed CDD window that applies to a real estate transaction applies to item 1 work where the customer is, or is to be, the buyer or transferee (Rules s 6-32(3)(b)). Item 1 work for a seller, and the other items, use the general delayed CDD allowance and its own conditions.

If your practice does both, the two halves of the same client relationship can be on different clocks. The full picture is on Customer due diligence.

Privilege, and what it does and does not change

Legal professional privilege interacts with reporting rather than excusing it, and the interaction is narrower than it is often assumed to be.

What it changes:

• The reporting deadline can extend. Where some (but not all) of the information required in the report is privileged, and the privilege belongs to someone other than the reporting entity, the non-terrorism deadline extends, and an LPP form accompanies the report. A terrorism financing suspicion stays on the shorter deadline regardless.
• A report can be withheld. Where all of the information on which the suspicion is held is privileged, the reporting entity may decline to give the SMR (s 41(2A)). No LPP form is required in that case.
• TTRs have their own co-filing rule. Where information required in a threshold transaction report is reasonably believed to be privileged, the report is accompanied by an LPP form.

What it does not change:

• Partial privilege does not remove the obligation to report. Where only some of the information is privileged, you still report, on the extended 5 business day deadline, with an LPP form. Only where all of it is privileged may you decline to report.
• The privilege has to belong to someone other than the reporting entity for the extension to apply.

Tipping off applies to everyone in the practice, from the moment a suspicion is formed

Disclosing that a suspicious matter report has been, is being, or will be made is a criminal offence where the disclosure could prejudice an investigation. It binds every person in the firm, not only the AML/CTF Compliance Officer.

In a legal practice, discussions about a client matter that would normally be routine become a risk once a suspicion has been formed. Keep the reporting work separate from the matter work.

The mechanics of LPP on reports are covered in full on Reporting, and the workflow for filing with privilege in play is on Filing a report. They are not restated here.

Where to start

In the order you will need them:

1. Obligations overview: the designated service test, which decides scope for each engagement.
2. Reporting, for the reporting obligations and how privilege interacts with them.
3. Customer due diligence, for the two limbs and the delayed CDD timing that differs between item 1 and the other items.
4. Creating a matter and Filing a report, to open engagements and handle reporting when it arises.

Related pages

• Conveyancer, for practices whose work is conveyancing.
• Accounting, which shares the Table 6 items.
• Known limitations, for what the product does not do.