An SMSF education specialist has recommended advisers and trustees alike should hold conversations with the ATO to negotiate workable compliance outcomes, no matter how unlikely the suggested solution may seem.
Speaking at the most recent SMSF Association Sydney chapter breakfast, Miller Super Solutions founder Tim Miller used the example of holding equities from an employee share scheme in an SMSF.
“[A member may have] brought these employee share schemes in and then you’d [subsequently] identified that maybe under the law you can’t acquire unlisted shares via an employee share scheme in a self-managed super fund, so how do you deal with it?” Miller said.
“You could say to the tax office ‘why don’t we just forget the whole thing ever happened because, to start with, they didn’t pay anything for’, it but if we say now the transaction did occur, well then they’re about to get a loss of ‘x’ hundred and thousands of dollars that they can use to offset future tax.
“If we forget the transaction occurred, then nobody loses in the situation.”
He said it would not be out of the question the ATO would be willing to accept that proposal as the outcome could probably be argued as a win-win situation.
Keeping things simple when dealing with the regulator was the key, he added.
“Often we try and overcomplicate things, whereas if we keep it pretty simple, the ATO are actually pretty simple from an operational point of view as well,” he said.
“So we shouldn’t fear the tax office on any of these issues.”