Key Dates
From 1 July 2026, new reporting entities- known as tranche 2 entities, must be compliant. And while there is still time, it’s important to start preparing early to ensure you meet your obligations.
- August 2025: New AML/CTF Rules published;
- October 2025: Core guidance to be released;
- December 2025: AUSTRAC to release ‘starter kits’ to help small businesses with compliance;
- January 2026: Finalisation of sector-specific guidance;
- March 2026: Enrolment for new reporting entities open
Failing to enrol by 1 July 2026 or within 28 days of starting a designated service after 1 July 2026 could result in major penalties – so don’t delay.
Understanding Designated Services: Who is captured?
The AML/CTF regime applies when business activity poses a risk of being used for money laundering or terrorism financing.
For the property sector, the brokering of the sale or purchase of real estate is the main designated service in scope for AML which impacts:
- real estate professionals – such as real estate agents, buyers’ agents and property developers; and
- lawyers and conveyancers with property transactions.
If you’re unsure, AUSTRAC has an online tool available to check if you will be regulated.
How to prepare?
- Enrol with AUSTRAC: Enrol and register with AUSTRAC from 31 March 2026 (tranche 2 entities).
- Risk Assessment: Identify and evaluate the specific money laundering, terrorism financing and proliferation financing risks your business may face. Determine how your business could be misused by considering the service, customers, geography and channels/ delivery methods of service.
- Policies & Procedures: AML/CTF program tailored to your specific practices.
It’s imperative you develop and maintain a comprehensive AML/CTF program. Document how you will comply, implement policies to mitigate and manage risks and ensure compliance with AML/CTF obligations. This includes staff training and the appointing of a dedicated AML/CTF compliance officer. - Enhanced Customer Due Diligence: The reform imposes stricter due diligence requirements, through more comprehensive identity checks, risk assessments and verifying source of funds as well as scrutinizing any large and unusual transactions. It’s important to verify and conduct ongoing CCD and consider the nature of the client’s circumstances and the nature of the transactions.
- Reporting to AUSTRAC & Record Keeping: Firms will be obligated to report certain transactions and suspicious activities to AUSTRAC, within three business days and any suspected terrorism financing must be reported immediately. All reporting records must be kept and stored securely. These records include transactions, electronic funds transfers, customer identification procedures and your AML/CTF program.
It’s essential to conduct regular independent reviews and deliver risk awareness training to ensure ongoing compliance of your AML/CTF program.
Concerns over new obligations
It is accepted across the industry that these reforms will be a challenge. Evidently there are many concerns relating to these upcoming changes, with property professionals aware of the added layer of complexity to transactions, significant increase in time, workload, administrative load and costs to meet the compliance obligations.
The issue is of particular concern among small business owners who are not resourced or equipped to carry substantial additional regulatory burdens. There is also an added need to manage potential impacts to customers including delays to settlement, verifying and recording detailed client information and impacts to how services are provided.
The Federal Government has included in the legislation, rules specific to real estate transactions to make the regime more effective and efficient. PEXA is working on a PEXA AML solution to help you meet your compliance obligations.
What should I do now?
- Confirm if you’re providing a designated service;
- Familiarise yourself with AUSTRAC guidance;
- Begin preparing and conduct risk assessments;
- Draft your AML/CTF program; and
- Plan for enrolment.
Begin preparing today, so you can be ready for compliance.
AML on demand
To help you prepare, PEXA is hosting an AML webinar series on demand.
Watch our first session 12 Months to AML Compliance, hosted by PEXA’s General Manager- Practitioners, Rukshana Sashankan, together with industry experts Neil Jeans, Partner- Risk Consulting at Grant Thornton and Jeremy Moller, Senior Advisor – Risk Advisory from Norton Rose Fulbright, who provide practical, actionable guidance necessary to navigate the upcoming changes.
