ATO clarifies next steps on double counting
The ATO has clarified that SMSFs who are victims of double counting do not need to relodge their TBARs, as an amended determination will be issued to correct any excess non-concessional contribution determination the trustee may have received in error.
The news comes following an SMSF Adviser report last week that SMSF administrators and accountants had seen a number of clients having their pensions double-counted in their total superannuation balance (TSB) because of transitional arrangements introduced as part of the TSB system.
The issue of how trustees could rectify this situation was unclear, with different SMSF administrators reporting that there may be a need to relodge the fund member’s TBAR, lodge a formal objection with the ATO or resolve the matter over the phone with an ATO official.
However, in an update on Friday, the ATO clarified that it had investigated the situation of double counting and would be issuing amended determinations over the coming weeks to the trustees affected.
“An incorrect excess non-concessional contribution (ENCC) determination may issue due to a known system issue with the calculation of some SMSF members’ TSBs. This is due to an incorrectly ‘double-counted’ individual’s pension in the calculation of their TSB,” the ATO said.
“We have fixes and processes in place to prevent an incorrect ENCC determination issuing in these circumstances. If an incorrect ENCC determination does issue, there is no need for the SMSF to amend its reporting — an amended determination should issue within four weeks.”
However, it noted the new guidance did not apply to SMSFs who had made a genuine error in their TBAR, as these funds would need to cancel the original reporting and issue a new TBAR.