ATO addresses ‘common headache’ with new advice
The ATO has recently issued new advice on how an individual can correct fund reporting errors, a move that has been labelled “positive” by AMP SMSF’s Peter Burgess.
The ATO has acted on a recommendation from the Inspector General of Taxation’s report on superannuation excess contributions tax, and late last week released further guidance on correcting fund reporting mistakes by way of examples, which can be accessed here.
Speaking to SMSF Adviser, Mr Burgess said this is a positive move which intends to address a “common headache” with the current excess contributions tax regime, given past difficulties with resolving contribution reporting errors.
When this results in the taxpayer exceeding their contribution caps, the inability to resolve these reporting errors can be particularly frustrating, Mr Burgess said.
“Similarly, super funds have sometimes experienced difficulties in assisting taxpayers where mistakes have occurred because it is unclear how to engage with the ATO in this regard. As a result a stalemate often arises with the taxpayer and their advisers are often left confused and frustrated about how to move forward,” Mr Burgess said.
“In some situations in the past, the ATO has intervened to assist taxpayers but the process has been ad hoc.
“By improving their processes and providing more advice about how individuals can resolve contribution reporting errors, it will help to formalise this process, which is good news for taxpayers, advisers and super funds,” he said.