ATO outlines SMSF sector concerns
There are a number of SMSF trustees and professionals “doing the wrong thing” despite the sector being relatively well-functioning, according to the ATO.
Speaking at the SMSF Professionals’ Association of Australia national conference in Brisbane last week, ATO deputy commissioner Alison Lendon told delegates there are several current and potential areas of concern within the SMSF sector.
Ms Lendon said on-time SMSF annual return lodgement is “still not high enough”, with some overdue funds’ details being removed from the Super Fund Lookup.
“Funds who haven’t lodged will remain off Super Fund Lookup until their lodgements are up to date,” Ms Lendon said.
The ATO is also working with ASIC and other institutions to identify and take action on instances of fraud within the SMSF sector, Ms Lendon said.
She also outlined limited recourse borrowing arrangements as an area of concern and encouraged practitioners to ensure these arrangements are appropriately implemented.
“Make sure you set up the arrangement correctly because there can be serious financial consequences if you don’t. Also, make sure it’s the right investment for the fund,” she said.
However, Ms Lendon said the growth of the sector in general is a “positive demonstration” of investors taking an interest in their retirement income.
“SMSFs form the largest sector of the Australian super industry, and the numbers are growing fast, so it’s vital that the sector remains appropriately regulated and complying,” she added.