Consultant highlights client segmentation strategy for TBAR
With the ATO confirming $1 million threshold for events-based reporting, client segmentation will become a useful approach to managing the new reporting requirements, according to an industry consultant.
Mr Dunn said SMSF firms that are looking at the requirements of their clients in relation to their funds may be starting to contemplate how they’re going to get this regular reporting done in their business.
“There is a need to be on some level of segmentation within the client base to separate those clients that have total superannuation balances above the $1 million,” explained Mr Dunn.
“For those clients, practitioners may need to be more strategy-focused in terms of how those benefits may be taken out if they’re contemplating partial commutations and so forth, versus those under the $1 million.”
SMSF practitioners, he said, should also be looking at clients that are just under the threshold because they may slide in and out of the events-based reporting system.
“Practitioners will still need to be active in the management of those, even though you only need to do that annually where the total super balance is under $1 million,” he said.
“You then have your lower-risk clients in the third category which are, in theory, never going to reach the $1 million so you don’t have any particular issues there.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.