As part of its COVID-19-related support, the ATO implemented a temporary email service for SMSF trustees and their tax agents to help where a commutation authority has been issued.
The temporary email service helps trustees and agents to understand why a commutation authority was sent to the fund and what they need to do in response.
It also helps identify any reporting issues which may have led to the ATO issuing the commutation authority in the first instance.
The service can also be used where a member of an SMSF has been approached by their APRA fund because the ATO has issued their APRA fund with a commutation authority and the SMSF professional or trustee is concerned there may be issues associated with the SMSF’s TBAR reporting.
In an online update, the Tax Office said the service has now been extended until 30 November 2020.
“SMSF trustees and their agents can email the early engagement and voluntary disclosure mailbox any time between now and 30 November 2020,” the ATO stated.
When using the service, the ATO said trustees or agents should provide as much information as possible including the fund that received the commutation authority, the ABN of the SMSF involved, when the commutation authority is due, the member the commutation authority relates to and any questions they have about the commutation authority.
The ATO reminded SMSFs that one of the common errors leading to a commutation authority is duplicate reporting.
This could be where the trustee has not properly identified or recorded that an event has been reported to the ATO before, where they have changed reporting platforms or administration systems and re-reported events due to a change in pension account numbers or not checked which events the trustees or previous agent have already reported for a new client, the ATO explained.
Errors can also occur where the trustee has not reported commutations that occurred where a member rolled over their pension interest to another fund.
The ATO noted that the service does not replace the obligation for trustees to comply with, and report their response to, a commutation authority within 60 days and is only to provide information to assist the SMSF trustee in meeting their obligations.
“This service is not available to assist individuals who have exceeded their transfer balance cap and have been sent an excess transfer balance determination,” it said.
