Commutation authority issues surfacing for APRA funds
The ATO has warned APRA-regulated funds that a small number of commutation authorities have been issued with an incorrect amount in certain circumstances and is contacting impacted funds this week.
In an online update, the ATO said a small number of the commissioner’s commutation authorities have been issued with an incorrect amount in some instances where the ATO have sent an ETB determination to an individual, the individual has commuted an amount less than the crystallised reduction amount set out in the ETB determination, and the commutation was reported after the due date.
“Our system is correctly evaluating the remaining amount that needs to be commuted, but is not populating the commutation authority with this amount. Instead the system is populating the commutation authority with the full value in the ETB determination,” the Tax Office said.
“We have stopped sending commutation authorities to funds to allow us time to investigate further and resolve the matter.”
The ATO said it will contact funds where it has identified that an incorrect commutation authority was sent.
“If you are concerned that we have issued you with a commutation authority that is incorrect and we have not contacted you, you should contact us by email,” it said.
The ATO also assured funds that it will still issue ETB determinations when an individual exceeds their cap and ETB tax.
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.