Accountants operating in the SMSF space have been warned that ASIC will closely scrutinise pension wind-ups over the remainder of the financial year in order to identify situations where illegal advice has been given.
Merit Wealth accountants services director David Moss told SMSF Adviser ASIC will analyse the tax returns of the funds in order to establish who is providing advice on pensions and whether they are authorised to provide that advice.
Mr Moss explained that if a client has a transition to retirement pension, for example, and they have it for tax purposes, their accountant is likely to suggest the client wind up the pension following the recent super reforms.
He said ASIC will know that the fund lodged a tax return with a deduction for exempt current pension income last year, with the tax return stating that it was in pension mode.
“When it’s no longer showing that it’s in pension mode in 2017, they will contact the client and ask why it’s no longer in pension mode. They will ask, ‘Did you do that yourself or did you have an adviser that was really helpful?’” Mr Moss said.
If the client tells ASIC it was their accountant, the corporate regulator will examine if that accountant is licensed.
“If ASIC then sees the accountant isn’t licensed, then ASIC has got them,” Mr Moss said.
“It’s not very hard for them to find this stuff out. A lot of accountants are going to potentially get themselves in strife.”
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