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SMSFs on a short leash
The Australian TaxationOffice (ATO) has signalled that it will be lifting the level of compliance activity surrounding self-managed superannuation funds (SMSFs) by increasing the number of people working in its compliance area by 350.
Deputy Commissioner for Taxation responsible for superannuation told the national conference in Perth that the boost in compliance staff numbers was connected in part to the impact of the Government’s Budget changes to superannuation.
She said the Budget changes had generated a spike in the number of SMSFs being established in Australia, which had lifted to 3,000 a month in May from a normal level of registration of around 1,800 a month.
Vivien said a number of new issues had arisen with respect to SMSFs and would be the focus of the ATO’s compliance program moving into 2007.
She said those issues were the residency test and record keeping, with the trustees of SMSFs needing to ensure they were residents in Australia for a sufficient period to make sure their fund was compliant for tax purposes.
Vivien suggested that SMSF trustees who were likely to be overseas for an extended period of time consider appointing a representative to handle their affairs in their absence.
With respect to record keeping, she said poor and inadequate records had emerged as a problem, with trustees expected to keep minutes of meetings and details of investment decisions.
AUTHOR
Mike Taylor
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