The draft superannuation measures have underlying complexities that will make it harder for SMSF trustees to comply under the new regime.
“Complexity is a problem because it introduces a barrier to people complying with the law,” Self-managed Independent Superannuation Funds Association (SISFA) managing director Mike Goodall told selfmanagedsuper.
“So if you make it harder for people to comply, the chances are they will fail the compliance and unwittingly create a penalty for themselves.
“In the second tranche there were 70-something pages in the proposal and there were 150 pages of explanatory memorandum – that’s where the complexity lies with people trying to understand all of that.
“We’ve got a couple of bright lawyers and some of these concepts have defied them, which aren’t really defined well anyway because they’ve been written poorly.”
Goodall’s comments come ahead of the 8th Annual SISFA SMSF Forum on 18 November in Melbourne where the new superannuation measures will be a key discussion point.
The new superannuation environment would also add costs, he noted.
“Super funds are going to have to comply with this and trustees are going to have to comply with this, so they’re probably going to see more specialist advisers [emerge] because the generalist advisers, if they’ve only sort of played with superannuation at the edges, this will just all be far too complex so they’ll go off and do investment and insurance advice and leave it [to the specialists],” he said.
“This will likely increase the costs for SMSF trustees trying to comply anyway.
“So it worries us that some trustees will find this all too hard, not seek advice and unwittingly fail some sort of compliance test.
“I know that [superannuation assistant commissioner] Kasey Macfarlane from the ATO said it was going to be lenient on this, but how long will the ATO take that attitude if people unwittingly keep failing compliance?”
Last month, the ATO revealed it would deliver new guidance to the industry, including practical examples and the commissioner’s views, when the bill for the super measures reached Parliament.
More information about the SISFA SMSF Forum can be found here.