Given the new monitoring capabilities of the ATO, SMSF auditors who attempt to “fly under the radar” could see their ability to practise as a tax agent compromised as well as their ability to become or remain an SMSF trustee.
With SMSF auditors now required to be registered with ASIC, the ATO can focus “hard and fast” on those offering auditor services and put their data matching capabilities into effect, Chartered Accountants Australia and New Zealand’s head of superannuation, Liz Westover, told SMSF Adviser.
“For example, if an annual return is lodged and someone is down as the auditor and they’re down as the tax agent as well, it’s now much easier for the tax office to be able to say, ‘hang on, this might be a problem’,” she said.
“That’s one of the more positive outcomes I think of the registration process: they can hone in on these particular issues.”
The ATO also now has the power to refer registered auditors to other government bodies where appropriate, including ASIC and the Tax Practitioners Board (TPB).
If a problem with an auditor was identified and the ATO notified the TPB, for example, the TPB could assess whether it was appropriate for that practitioner to be a licensed tax agent.
In addition, if an auditor has their registration disqualified, it may impact their ability to be an SMSF trustee.
“[The ATO] want to make sure people take their responsibilities as trustees seriously,” Ms Westover said. “If you can’t do it as an auditor, how can you be trusted to uphold your responsibilities as an SMSF trustee as well?”
Ms Westover stressed that while rogue behaviour is by no means commonplace, it is pertinent to warn auditors of the implications of their behaviour.
“If you think you can fly under the radar, you really are running a huge risk now because the data matching capabilities of the tax office are becoming so sophisticated,” Ms Westover said.
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