ATO makes moves to fix ‘unworkable’ TBC data access
With the limited access to transfer balance cap information for clients causing frustration for many SMSF professionals, the ATO has unveiled plans to make it more accessible to tax agents later in the year.
By the end of July 2018, ATO deputy commissioner James O’Halloran said approximately 135,000 SMSFs had reported transfer balance cap information to the ATO, with the ATO issuing approximately 2,000 excess transfer balance determinations to members of SMSFs.
“We expect that some of these determinations will be amended or revoked as further information is reported to us, for example if a member rectified a small excess under the transitional rules,” said Mr O’Halloran.
“Some individuals will need to act on these determinations and ensure the excess is commuted in full, including cents, by the due date. Trustees will then need to ensure that the commutation is reported to us no later than 10 business days after the end of the month, otherwise we may send a commutation authority to the member’s fund.”
One of the frustrating aspects for professionals dealing with transfer balance cap reporting or excess TBC determinations for clients, he said, has been the difficulty in accessing information about a client’s transfer balance cap.
“We appreciate agents want to be able to see the information we’ve relied on when determining their client has exceeded their TBC,” said Mr O’Halloran.
Tax agents will soon be able to see this information through the ATO’s online services environment, he said, when it moves into public beta testing, which is expected to be later this year.
The online services environment will allow tax agents to view details on bring forward arrangements and transfer balance caps. They will also be able to lodge TBARs for clients.
“They will also [be able to] lodge elections for their clients for concessional, non-concessional and transfer balance caps,” the ATO said.
In the meantime, Mr O’Halloran said SMSF practitioners will have to continue asking clients to access this information through their MyGov account, download the information and email it to them.
SMSF Alliance practice principal David Busoli said relying on the member to provide this information from their MyGov account is “not workable in the real world”.
He also pointed out that it is not just tax agents that need access to the ATO’s transfer balance cap information, with SMSF administrators and financial planners also requiring this information for clients.
“Until TBC information is accessible to all parties involved in servicing the member’s needs, errors will be common,” Mr Busoli warned.