The ATO is not adequately set up to manage SMSFs and ensure their continuing compliance, Wealth Within chief analyst Dale Gillham said.
“The ATO is not built for that purpose. SMSFs are the fastest growing sector of the market. How are they going to keep up with that? They’re not,” Mr Gillham said.
“APRA is already designed to [regulate] anyway,” he added. “To me, it’s just a natural fit that they should be doing it rather than the ATO, which is supposed to be looking after tax.”
Mr Gillham also said education for prospective SMSF trustees should be compulsory, to ensure suitability of the fund for their circumstances.
“When you [see] at least half of the investments in SMSFs on average are in shares, that says to me that people need to be educated,” he said.
Increased interest in limited recourse borrowing arrangements and property investment within SMSFs also heightens the need for mandatory trustee education, Mr Gillham added.
“Now that property has become bigger in terms of buying for SMSFs, [education] has become more critical, because that’s a huge mistake if you get that wrong.”
APRA ….. ASIC anyone else? all I see is a cash grab…..who will we be paying supervision fees to that have increased by 500% over the past 5 years
What is Mr Gillham’s background? His comments re shares is consistent with the comments we see coming from the lobbyists for banks and insurance companies who want to peddle their managed funds under the guise of the need for diversification. One of the reasons, among many others, that SMSF’s like shares is that they can escape these FUM fee hunters.
When you [see] at least half of the investments in SMSFs on average are in shares, that says to me that people need to be educated, he said.
What a stupid statement. Perhaps people diversify by holding property outside their SMSF. Perhaps they get advice that suits their needs. Perhaps they are educated and made decisions based on their needs and preferences rather than pure diversification. Encourage trustees to get unbiased independent advice yes but to say trustees need to be educated is insulting.
Mr Gillham’s inner totalitarian on display. Some people are never happy until they can “regulate”, ie “control” everything that moves. Itchy fingers creating more bureaucracy and cost.
Mr Gillham also said education for prospective SMSF trustees should be compulsory, to ensure suitability of the fund for their circumstances.
When you [see] at least half of the investments in SMSFs on average are in shares, that says to me that people need to be educated, he said.
Excuse me Mr Gillman! Just where do YOU get off telling ME what I should do with MY investments?
Just check the pronouns Mr Gillman.
I’d prefer a supervision system that makes life easier for the 80% vanilla funds and places the cost of regulations on the 20% of funds gaming a good system