With events-based reporting set to generate huge amounts of data, concerns have been raised about whether the ATO’s systems will be able to cope with the large volume of information.
Speaking at a seminar, DBA Lawyers special counsel Rebecca James said there will be a huge amount of data going to the ATO once events-based reporting commences, particularly in relation to pension commencements and partial commutations of pensions.
She also believes the amount of commutations may be on the rise which will further increase the amount of information being sent to the ATO.
“We may see commutations becoming more prevalent because with pensions for example, if the client wants to take more than the minimum pension amount, instead of just taking it as a pension which doesn’t give rise to a debit in the transfer balance cap, they may take it as a commutation because that does give rise to a debit, so they can top up their retirement balance in the future,” she explained.
“So we could see commutations occurring more frequently and that puts the pressure on for this [new] reporting.”
Ms James noted that many accountants and advisers have highlighted some of the issues that occurred with reporting under the reasonable benefit limit (RBL) and that it took years for action to be taken.
“Hopefully the ATO’s systems will be up to scratch to be able to handle the volume of reporting,” she said.
“I don’t know what the ATO will do with all this information and whether it will be dealt with on a timely basis. It will be interesting to see to what extent they’re building systems to be able to deal with this, and what they’re going to do with all the information.”
The ATO has said the paper form will likely be available for SMSFs from October, and is in the process of developing an online reporting channel for single lodgement.
“Given there are 500,000 super funds, I would think that a paper-based reporting system will be highly cumbersome so ultimately you would expect it to be moved to electronic systems,” said Ms James.
It will be critical, she said, that once the new reporting requirements are in place, that members are fully aware of what needs to be reported and when in terms of time frame, and the penalties that are involved.
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 21 Sep 2016‘Robo-advice’ reference turning SMSF investors awayBy Staff Reporter
- 21 Sep 2016SMSF firms told not to ‘antagonise ASIC’By Miranda Brownlee
- 21 Sep 2016ATO to release further guidance on reservesBy Miranda Brownlee
- 20 Sep 2017‘Execution only’ approach with SMSFs high-risk for accountantsBy Miranda Brownlee
- 20 Sep 2017Super saver scheme to benefit wealthy, says consultantBy Miranda Brownlee
- 19 Sep 2017Government rules out tax cut for family trustsBy Lara Bullock
- view all
- ‘Robo-advice’ reference turning SMSF investors away
Some SMSF trustees are ignoring automated advice services on the false assumption that none of these services involve any human overlay, say...read more
- ‘Execution only’ approach with SMSFs high-risk for accountants
An industry lawyer has warned the unlicensed accounting firms recently contacted by ASIC that justifying the provision of services without a...read more
- view all