The SMSF Association has welcomed the Australian Taxation Office’s (ATO’s) move to allow self-managed superannuation funds (SMSFs) to report relevant transfer balance cap (TBC) events on a quarterly or annual basis.
From 1 July 2018, the ATO would allow SMSFs to report relevant TBC events on a quarterly basis if a member of the fund has a total super balance of $1 million or more and all other SMSFs would report on an annual basis.
SMSFs with a member having $1 million or more in super and receiving a pension from these assets would have to report to the ATO 28 days after each quarter on any TBC event, including commencing a pension or commuting some or all of a pension.
The SMSF Association’s chief executive, John Maroney, said the association was pleased the ATO had listened to industry concerns about event-based reporting, and agreed to a balanced approach to reduce the TBC compliance burden on SMSF trustees and their advisers.
“This consultation shows that the ATO is willing to work with the industry to ease the implementation of event-based reporting,” Maroney said.
The association also said the ATO had followed its recommendation to carve out SMSF members with super balances of under $1 million from event-based reporting of TBC events. These individuals would continue reporting under the current rules of annual SMSF reporting.
The association proposed a $1 million super balance threshold for individuals, reducing those receiving a pension and having to report by about 85 per cent. This would also aid the implementation of the transfer balance account report (TBAR), Maroney said.
“We are also pleased that the ATO has simplified TBAR implementation by not progressing with a transition period before more onerous reporting timelines would apply,” he said.
