Regulator buckling under SMSF pressure
THERE IS a risk of a “meltdown” in the SMSF sector, with the ATO being under-resourced and trustee numbers continuing to grow, according to one financial services analyst.
Speaking to SMSF Adviser, Wealth Within’s chief analyst Dale Gillham said the ATO is “struggling” to keep up with its normal tax duties and is “under-resourced completely”.
“With SMSFs over the last five years – on top of a GFC – no wonder the tax department can’t keep up, and changes to superannuation are just constant,” Mr Gillham said.
“If [the ATO is] not properly resourced, then there’s going to be people getting scammed and there’ll be a meltdown in that SMSF area in some form or other.
“If you don’t have enough resources you’ll get people trying to bend the rules and manipulate the system.”
Mr Gillham added that APRA would be a more appropriate regulator of SMSFs, even if the ATO was given additional resources.
“APRA has been managing superannuation for a long time. They’re already set up to manage superannuation and they understand what it’s all about,” he said.
“Whereas the ATO, it’s the tax office, so what has tax got to do with superannuation? I never understood why [SMSFs] came under the tax office."