The tax office has underlined circumstances where it may be in SMSF members’ best interests to report their accumulation-phase value (APV) as part of their transfer balance account report (TBAR).
In a recent podcast moderated by SMSF Association chief executive John Maroney, ATO deputy commissioner James O’Halloran said SMSFs can report their APVs on the SMSF annual return, but it is optional for most funds.
O’Halloran outlined two circumstances where it may be in a member’s best interest to report their APV, although he stressed these decisions are for members to make themselves.
“One is where a member has a flexi-pension or a capped defined benefit income stream. So reporting the APV even if that value is nil will prevent us overvaluing the member’s total super balance,” he said.
“Secondly, where the member’s APV is less than the closing account balance because of admin fees or administration, I should say, exit fees and realisation costs.”
He added if members do not report an APV, the ATO will most likely use the closing account balance and any retirement-phase value reported to determine the member’s APV.
SMSF members must also report their retirement-phase value if their SMSF is paying pensions and the closing account balance.
O’Halloran said the tax office will continue to provide further information through its online services for SMSF professionals and trustees.
“The ATO is displaying information to help members manage their transfer balance caps (TBC), including how the transfer balance account is being calculated, if the TBC has exceeded limits, and details of super funds that have reported the TBC events so they can be contacted in the event of any incorrect reporting,” he noted.
“Our aim really has been to recognise the importance of many of the transitional features so that people can see it and prevent breaches.”
