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AUSTRAC Tranche 2 Explained: What 100,000 Newly Regulated Australian Businesses Need to Know

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AUSTRAC Tranche 2 Explained: AML/CTF Compliance Guide for Newly Regulated Businesses (2026) | Truth Technologies
In Short

On 1 July 2026, AUSTRAC's Tranche 2 reforms brought real estate professionals, lawyers, conveyancers, accountants, dealers in precious metals and stones, and trust and company service providers under Australia's AML/CTF Act for the first time. AUSTRAC's regulated population grew from roughly 19,000 to roughly 100,000 entities overnight. Newly regulated businesses must enrol with AUSTRAC, stand up an AML/CTF program, and use the new Threshold Transaction Report (TTR) and Suspicious Matter Report (SMR) forms released the same day.

What Is AUSTRAC Tranche 2?

AUSTRAC Tranche 2 is the second stage of Australia's long-planned expansion of anti-money laundering and counter-terrorism financing (AML/CTF) regulation. Where the original AML/CTF Act 2006 focused on banks, remittance providers, casinos, and bullion dealers, Tranche 2 extends the same obligations to a set of professions that routinely handle high-value transactions but had never been formally regulated for money laundering risk.

The reform took effect on 1 July 2026, following two rounds of public consultation that drew 229 industry submissions.

Who Is Newly Regulated Under Tranche 2?

The following sectors now provide "designated services" under the AML/CTF Act and must comply with the same core obligations as banks and financial institutions:

  • Real estate professionals — agents and agencies involved in the sale of real property
  • Lawyers and conveyancers — when providing services related to property or business transactions, trust and company structures, or the management of client money
  • Accountants — when providing services such as company or trust formation, or managing client funds
  • Dealers in precious metals and precious stones — for transactions above the relevant reporting threshold
  • Trust and company service providers (TCSPs) — providers of company formation, nominee director, and trustee services
Oscar the owl Truth Technologies compliance assistant
Good Tip from Oscar

Not every service your business offers is automatically a "designated service." AUSTRAC's obligations attach to specific activities, not to your business as a whole. The first step is mapping which of your services actually trigger AML/CTF obligations before building your program around them.

Key Dates You Need to Know

Date What Happened
31 March 2026 AML/CTF (2025 Rules) Amendment Rules 2026 took effect, including the new opt-out Reporting Group model and Proliferation Financing as a formal third risk category. AUSTRAC also opened enrolment for Tranche 2 entities.
1 July 2026 Tranche 2 obligations commenced. New TTR and SMR forms released.
29 July 2026 Enrolment deadline for newly regulated entities.
30 March 2029 End of the transitional window for pre-existing reporting entities to move to the new TTR/SMR forms.

There are no changes to cross-border movement reporting or international funds transfer instruction (IFTI) reporting under Tranche 2.

What Newly Regulated Businesses Must Do

1

Confirm whether you provide a designated service. Review your services against AUSTRAC's designated services list. Obligations attach to specific activities, not to your business as a whole.

2

Enrol with AUSTRAC. New entities were required to enrol by 29 July 2026. If you have not yet enrolled, this is the most urgent step.

3

Appoint and designate an AML/CTF compliance officer. This person is your point of accountability to AUSTRAC.

4

Build an AML/CTF program. This includes a risk assessment, customer due diligence procedures, and ongoing transaction monitoring.

5

Prepare to file using the new TTR and SMR forms. These are mandatory for newly regulated entities from day one.

6

Determine your Reporting Group status. If you operate as part of a corporate group, understand the opt-out model introduced under the March 2026 Rules.

Frequently Asked Questions

What is AUSTRAC Tranche 2?
AUSTRAC Tranche 2 is the expansion of Australia's AML/CTF regime, effective 1 July 2026, to cover real estate professionals, lawyers, conveyancers, accountants, dealers in precious metals and stones, and trust and company service providers. These sectors did not previously have AML/CTF obligations under the original AML/CTF Act 2006.
Who does AUSTRAC Tranche 2 apply to?
It applies to real estate agents and agencies, lawyers and conveyancers handling property or business transactions, accountants providing services like company formation or trust structuring, dealers in precious metals and stones above the relevant threshold, and trust and company service providers offering company formation, nominee director, or trustee services.
When did AUSTRAC Tranche 2 come into effect?
Tranche 2 commenced 1 July 2026. New businesses coming under regulation for the first time were required to enrol with AUSTRAC by 29 July 2026.
Do I need to use new AUSTRAC reporting forms?
Yes. New Threshold Transaction Report (TTR) and Suspicious Matter Report (SMR) forms were released on 1 July 2026. Newly regulated businesses must use them from day one. Pre-existing reporting entities that were already reporting to AUSTRAC before 30 March 2026 have a transitional window to move to the new forms at any point up to 30 March 2029.
What happens if my business does not comply?
Non-compliance, including failing to enrol or adopt an AML/CTF program, exposes a business to regulatory action from AUSTRAC, including civil penalties. Businesses newly captured by Tranche 2 should treat enrolment and program adoption as immediate priorities rather than optional compliance items.
What is a Reporting Group under the new Rules?
Under the AML/CTF (2025 Rules) Amendment Rules 2026, which took effect on 31 March 2026, related entities in a corporate group are automatically part of a Reporting Group unless a reporting entity formally opts out in writing. The opt-out model replaced the previous opt-in structure.
How many businesses does AUSTRAC now regulate?
AUSTRAC's regulated population grew from approximately 19,000 entities to approximately 100,000 as a result of Tranche 2. The expansion is the largest single increase in AUSTRAC's regulated population since the original AML/CTF Act came into force in 2006.

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Official Sources

This article reflects information published by AUSTRAC as of 24 September 2026. AML/CTF regulations and AUSTRAC guidance are subject to change, and this article is not updated retroactively. This content is provided for general informational purposes only and does not constitute legal, compliance, or regulatory advice. Businesses should confirm their specific obligations directly with AUSTRAC or a qualified legal or compliance professional before taking action.