SMSF Academy director Aaron Dunn says the tax office is aware of the fact that some SMSF practitioners and trustees may be looking to apply different valuations for assets depending on whether it relates to the transfer balance cap or the CGT relief.
“The ATO will be looking for evidence of inconsistencies where we may be looking at different valuations, where we’re trying to balance out what we might want to do for CGT purposes versus what we might be looking to do when reporting [a value] against a member’s transfer balance cap,” Mr Dunn said.
In a recent webinar, ATO director of technical leadership Helen Morgan said where assets in an SMSF are being valued for CGT purposes on 30 June 2017 in relation to an income stream that’s going forward, the tax office “would expect to see the same valuation being applied to those assets when the trustees of the fund are calculating the 30 June value for those assets for the member’s transfer balance cap purposes”.
“So if you’re using a value on 30 June 2017, we would expect that valuation to be consistent across the CGT relief provisions and the transfer balance cap measures,” Ms Morgan said.
She said the market values should be determined under the ATO valuation guidelines on its website.
Ms Morgan also explained that funds will report the election to apply CGT relief via the CGT schedule, which will be updated to provide relevant fields to report the election.
“The updated CGT schedule will be available alongside the 2016-17 SMSF annual return as part of the tax time 2016-2017 changes in time for the lodgement due dates for funds,” she said.
“It’s important to note that funds wishing to apply for CGT relief will need to complete this schedule to make that election, even if they would not ordinarily do so because their CGT losses or gains are less than