The SMSF Professionals’ Association of Australia (SPAA) has called on the federal government to reduce the annual levy self-managed funds have to pay to the Australian Taxation Office in the upcoming budget.
According to the industry body, the coalition could now afford to lower the levy because it had managed to scrap the substantial backlog of tax amendments left over by the previous government.
“These measures, such as related-party transactions, SMSF bank verification, SMSF rollovers being included as a ‘designated service’ under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, and taxing super benefits received illegally at the top tax rate, are no longer part of the SMSF architecture, so it seems fair to assume the cost of administering the SMSF sector has fallen accordingly,” SPAA technical and policy senior manager Jordan George said.
“In addition, the government’s announcement on clearing the tax amendment backlog pointed to the levy being adjusted to address these changes, and SPAA would urge it to do so in the lead-up to the budget and then make the appropriate announcement.”
In recent years the annual levy has increased by 36 per cent, jumping from $191 in 2012/13 to $259 in 2013/14.
“The ATO has agreed to provide evidence for the most recent increase in the levy and why the cost-recovery process for SMSFs had increased, but the industry has yet to see the evidence,” George said.
He was, however, quick to stipulate SPAA supported the idea of an SMSF levy being in place.
“SPAA has no issue with a levy. But we firmly believe that the levy should accurately reflect the ATO’s costs in administering the SMSF’s superannuation obligations and, as such, should be revenue neutral,” he said.
