The ATO has stressed SMSF trustees do not need to be overly concerned about the perception the administrative requirements in running a fund will significantly increase due to the introduction of real-time reporting.
“It’s important to contextualise the scope of the events-based reporting. It will only be required where a member actually has a transfer balance debits or credits, so, for example, if they commence an income stream,” ATO SMSF segment assistant commissioner Kasey Macfarlane said in an exclusive interview with selfmanagedsuper.
“In any particular period where they don’t have one of those actions there will be nothing more to report and nothing extra to do.
“It’s worthwhile to note then that in many cases, for many SMSF members throughout the life of their fund, they’re only going to ever have one or two transfer balance cap events anyway.”
According to Macfarlane, it means SMSF trustees should feel at ease real-time reporting will not mean having to do so every month or every quarter on a continual basis.
Despite recognising many SMSFs would not be significantly affected by the introduction of events-based reporting, the ATO still acknowledged how disruptive the process will be and to that end is making a conscious effort to support and assist the industry in making the transition.
“We do recognise it is a significant change in comparison to the existing reporting arrangements for SMSFs where they report once a year through the SMSF annual return,” Macfarlane noted.
“That’s why we’re putting in place some transitional arrangements [to help the process].”
In the lead-up to 1 July, the regulator made efforts to dispel the myth this date was a definitive reporting deadline.
“There was a view that 1 July was a very hard-coded reporting deadline. It is when the law changes, but sometimes events are not going to materialise immediately on 1 July and the SMSF reporting of account balances is something we did not require,” ATO superannuation deputy commissioner James O’Halloran said.