Speaking in a webinar, DBA Lawyers special counsel Bryce Figot said given that the earnings on assets supporting a TRIS that’s not in retirement phase were taxable from 1 July 2017, some practitioners who now are seeing clients in February might decide to back-date notification of when the TRIS entered retirement phase.
“Let’s say you meet with the client in February 2018, you might say ‘well you've got a TRIS but we think you are actually retired and you just never bothered converting it, so let's notify your fund, and let’s make it so the fund was notified on 1 July 2017’,” said Mr Figot.
SMSF practitioners might be tempted to do this because the fund would be in pension mode for 364 out of 365 days, with around 99.7 per cent of the fund’s income exempt.
Mr Figot warned that back-dating or falsifying documents was a very serious offence, however, and stressed that anything suspicious was likely to be noticed by the ATO.
“Given that 1 July 2017 was a Saturday, and given that the legislation by that stage had only been around for a touch more than a week, I would really query how many people genuinely did contemporaneously notify on the 1st of July 2017. Maybe some did, but you'd really have to be able to put your hand on your heart if you did,” he said.
“This is an area where it's quite possible that if people do start doing anything untoward whatsoever, such as back-dating or falsifying documents, there could be some active compliance monitoring by the ATO.”