The Australian Taxation Office (ATO) is optimistic the new penalty regime available to it from 1 July will cut down repeated compliance breaches by SMSF trustees.
“The reason why I’m hoping this is going to be a good thing is that some of the funds we make non-complying and the reason we make them non-complying is when we first found them we said ‘that’s the contravention, this is what you should be doing and please don’t do it again’,” ATO superannuation assistant commissioner Matthew Bambrick told delegates at today’s Institute of Chartered Accountants in Australia business forum.
“Then they say ‘yep [we] understand that’, but then they do it again. And for some of them they do it again and they keep doing it and we end up making them non-complying and they lose half of their retirement savings. That’s not a good result.
“So we’re hoping the penalties received the first time around will be a penalty that is taken seriously and they [trustees] don’t do it again.”
Bambrick said the way the penalties would be administered would largely depend on how the ATO viewed the fund and the behaviour of its trustees.
“What do I mean by that? It’s what we think about their compliance attitude and their compliance history,” he said.
“So, for example, if you want us to look kindly upon you as a fund, then the best thing to do when you come across a contravention is fix it. Don’t hide it. If we come across it, don’t try to not engage with us.
“The best thing we like to see when we come across something, or we get an auditor contravention report, is when we talk to you, you’ve already fixed it.”
He stressed the new penalties would apply to contraventions that occurred before 1 July as well as future contraventions.