ATO called on to change ‘grossly inefficient’ TBAR declarations
The ATO is being called on to replace the cumbersome declarations process for a TBAR (transfer balance account report), as it similarly has with Single Touch Payroll (STP) reporting.
The declarations section of a TBAR require the entity lodging the report to obtain a declaration from the trustees, confirming that the tax agent is authorised to report the information provided.
“Based on our own conversations with the ATO and the ATO’s stated position on the bulk lodgement of activity statements and tax returns, it is our understanding that these declarations are required every time a TBAR is lodged, which really defeats the purpose of bulk lodgements as it makes the whole process grossly inefficient,” SuperConcepts’ general manager for technical services and education, Peter Burgess, told SMSF Adviser.
The ATO recently announced concessions for the STP regime, whereby a tax agent can get an engagement authority from their client, which removes the need for declarations each time they report.
“We think allowing super providers to obtain an ‘engagement authority’ which covers all TBAR reporting up front for the income year makes a lot of sense,” Mr Burgess said.
“It will remove a lot of red tape and inefficiencies with TBAR reporting. For the same reasons it was proving clunky for STP reporting, it is and will continue to prove clunky for TBAR reporting so we are calling on the commissioner to make similar concessions to streamline TBAR reporting,” he said.
The TBAR regime workload is so far proving a struggle for some SMSF professionals, particularly around June 30.
“A lot of accountants didn't actually realise they had to lodge a TBAR by [30 June 2018] specifying the value of the client's pension balance at [30 June 2017],” TriSuper SMSF Auditors director Joel Curry recently told SMSF Adviser.
For the STP regime, which is currently in force for employers with 20 or more employees, the declaration requirement was proving to be a clunky and frustrating part of the new reporting requirements.
“If you lodge an income tax return, or an activity statement on behalf of a business, you’ve got to get that declaration each time you do that before you can submit to the ATO. For STP, we had a lot of feedback that with weekly or fortnightly frequency, if that’s how often you do your payday, that was a bit of a burden and a bit of red tape to still have that for STP,” said assistant commissioner and Single Touch Payroll lead at the ATO, John Shepherd.