New SMSF Penalty Regime
The new measures means ATO will now have greater flexibility on dealing with SMSF non-compliance by issuing:
– Rectification directions for contraventions of the superannuation law
– Education directions to trustees of the SMSF
– An Administrative penalty regime for SMSF trustees for certain contraventions of the SISA.
A rectification direction will require a trustee to undertake specified course of education within a specified time frame, and provide the ATO with evidence of successful completion of the course.
Where an administrative penalty is imposed it must be paid personally by the trustee or the director of the trustee company and cannot be paid or reimbursed by the SMSF. Where a SMSF has individual trustees, the ATO will impose any penalty on each individual trustee, meaning the penalty will be multiplied by the number of trustees. Corporate trustees, however, will incur only 1 penalty.
Summary of the proposed penalty:
|
SISA Section |
Rule |
Administrative Penalty |
| s35B | Failure to prepare Financial Statements | $1,700 |
| s65 | Lending or providing financial assistance to members & their relatives | $10,200 |
| s67 | Super fund borrowings, outside the permitted exemptions (e.g. limited recourse borrowing arrangement) | $10,200 |
| s84 | Trustees have not taken reasonable steps to comply with the In House Asset Restrictions | $10,200 |
| s.103(1) & (2) | Failing to keep trustee minutes for at least 10 years | $1,700 |
| s.104 | Failing to keep records of change of trustees for at least 10 years | $1,700 |
| s.104A | Failing to sign Trustee Declaration within 21 days of appointment and keeping for at least 10 years | $1,700 |
| s.105 | Failing to keep member reports for 10 years | $1,700 |
| s.106 | Failing to notify ATO of an event that has significant adverse effect on the super fund’s financial position | $10,200 |
| s.106A | Failing to notify ATO of change of status of SMSF, e.g. super fund ceasing to be a SMSF | $3,400 |
| s.160 | Failing to comply with ATO Education directive | $850 |
| s.254(1) | Failing to provide the Regulator with information on the approved form within the prescribed time upon establishment of the super fund | $850 |
| s.347A(5) | Failing to complete a form with requested information provided by the Regulator as part of the Regulator’s Statistical Program | $850 |
If you have any questions on SMSF, please contact us on 1300 736 453.
The information contained in the article may not be appropriate to your individual needs therefore you should seek personal financial advice before making any financial or investment decisions.
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