As previously reported by SMSF Adviser, SMSFs were going to be required to report both the member’s 30 June 2017 pension and accumulation phase values using a TBAR, in order to allow the ATO to calculate a member’s 30 June 2017 total super balance.
This was a surprise to those in the industry who thought that only the member’s pension balance would need to be reported.
However, following further consultation with industry, the ATO now looks set to revise this approach.
SuperConcepts executive manager of SMSF technical services Mark Ellem explained to SMSF Adviser that the ATO will now only require the member’s 30 June 2017 accumulation phase value to be reported when the member is also in receipt of a capped defined benefit pension or a flexi pension from the fund.
“This is a good outcome for the SMSF industry. It has always been the industry’s understanding that the only 30 June 2017 member balance that needed to be reported via a TBAR was the member’s pension balance,” said Mr Ellem.
“Now with the exception of some legacy pensions, this revised ATO position essentially restores this position.”
What this means, he said, is that when a member in an SMSF has both an accumulation and pension phase value, the ATO will calculate the member’s 30 June 2017 TSB using member balance information provided on the SMSF annual return and the pension balance information reported via a TBAR, rather the requiring funds to report these balances separately on a TBAR and then using those figures to calculate the member’s TSB.
Where a fund does report a member’s accumulation phase value via a TBAR, the ATO will still use this information to calculate the member’s 30 June 2017 TSB, he explained.
“So where the member’s withdrawal value is materially less than the amount included in the closing balance reported in the SMSF annual return, it might still be in the member’s best interest to report their accumulation phase value via a TBAR,” he said.
Mr Ellem said whilst the TBAR for existing retirement phase pensions as at 30 June 2017 is due 1 July 2018, he understands that the ATO will not be using this information to calculate a member’s TSB until mid-September 2018.
“Consequently, if an SMSF has already lodged a TBAR in relation to member retirement phase pensions, they can lodge a further TBAR to report the member’s accumulation phase value. It appears this will be compulsory if a member is in receipt of a capped defined benefit income stream or a flexi pension,” he said.
Other Information – Question 15 – Total super balance – Event Type: Accumulation Phase Value.
Then, Complete Q17 & Q18
Can somebody please advise where the above TBAR reporting obligations are outlined by the ATO? The TBAR instructions and the ATO’s TBAR guide don’t make any mention of reporting Accumulation balances. I have several MLP which we have reported using the instructions and ATO guidelines and have not reported Accumulated member balances in any of them.