The ATO has raised concerns over the lack of acknowledgement by trustees of receiving important notifications it issues, such as release authorities and correspondence about potential fraudulent activity.
ATO superannuation and employer obligations deputy commissioner Emma Rosenzweig informed delegates at the recent SMSF Association National Conference 2025 in Melbourne that a noticeable number of trustees are not responding to release authorities for excess contributions made to their funds.
“This means that super is being taxed concessionally when it shouldn’t be and there are consequences for this,” Rosenzweig warned.
She reminded practitioners of the penalties trustees may face should these instructions not be followed properly.
“For trustees who fail to release the nominated amount, a non-compliance penalty with a maximum of 20 penalty units, or $6600, may be incurred,” she said.
According to Rosenzweig, similar behaviour has been detected with regard to commutation authorities, where SMSF trustees have failed to respond to an excess transfer balance determination as a result of a member exceeding their personal transfer balance cap.
“Trustees need to ensure they are following their legal requirements and respond with the required action as set out in the notices,” she explained.
“Not doing so may affect the SMSF’s entitlement to exempt current pension income and trustees may also be liable for penalties or subject to compliance action.”
She took the opportunity to remind practitioners of the position they carry in servicing SMSF clients and the responsibility they must acknowledge with reference to these types of trustee actions.
“As you can see, there are a number of areas we are concerned about that should be considered fundamental expectations,” she said.
“Your direct access to clients puts you in a really ideal position to influence trustees and members to ensure they meet their obligations that they have accepted in choosing to run their own super fund.”