SMSFs urged to address compliance issues with collectibles
Despite the new rules for collectibles having been in place for all collectible assets since the beginning of July, one SMSF auditor says some trustees are still failing to comply.
“It’s important to know that these sorts of things had to be finalised by the 1 July 2016. The longer trustees don’t meet these new guidelines, the more risk there is that it will be picked up at the next audit, and there could be a compliance issue for those types of assets when the next audit rocks around,” said Ms Banton.
She noted that while the insurance requirement was previously difficult to meet for certain assets, the ATO has now made this easier by allowing trustees to have the asset covered under a contents policy, as long as it’s in the name of the super fund.
“You don’t necessarily need to have all of the items listed on that contents policy, but the value of the policy has to cover the market value of the assets,” she said.
Ms Banton stressed that the policy does need to be in the name of the super fund with some trustees incorrectly listing collectible assets on the contents policy for themselves.
“This was previously okay as long as you had the super fund listed as an additionally insured, but that’s no longer going to complying,” she said.
“SMSF trustees really need to think about how they’re going to meet those guidelines and, at this point in time, if they think that it’s too onerous to do that then they need to remove that asset out of the fund.”