Administration, ATO, Compliance

Quarterly TBC report dates draw closer

The SMSF Association has reminded SMSFs on a quarterly transfer balance cap (TBC) reporting cycle they must make their first lodgement with the ATO in three weeks.

Head of policy Jordan George said SMSFs reporting quarterly must disclose any TBC events for the quarter of the 2018/19 financial year by 28 October.

He added it was important to remember once an SMSF is assessed as either suited to annual or quarterly reporting, it remains on that schedule for the life of the fund.

“As SMSFs generally align the valuation of their assets with the completion of their end-of-year financial accounts, it’s possible that funds will not know the exact value of their income stream by this date,” George said.

“However, the ATO has stated that SMSFs can use its valuation guidelines, and, if the valuation is consistent with these guidelines, it will accept a ‘reasonable estimate’ of the starting value of a retirement superannuation income stream.”

SMSFs with any members with a total super balance of $1 million or more must report events affecting members’ transfer balances within 28 days after the end of the quarter in which the event occurs. Those funds that do not fall into this category will continue to report annually.

Even when an SMSF has only one member with an individual total super balance of $1 million or more it must report all events within 28 days after the end of the relevant quarter, even if the balances of the first member to start a retirement phase income stream is below $1 million.

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