SMSF trustees should be able to retain the right to deduct fees above $3000 for managing their tax affairs, according to a specialist SMSF adviser who has predicted the limit will be overturned.
Verante Financial Planning director and specialist SMSF adviser Liam Shorte said the cap was too low, particularly if an SMSF trustee was forced to take legal action against the ATO.
Shorte made the comments during an address at an SMSF Association investor event in Sydney, in reference to a proposal from Labor which suggested a $3000 maximum deduction cap be introduced for managing tax affairs related to a fund.
“Anybody who has ever had to deal with the ATO, and working on a legal matter before a tribunal, will understand this sum will probably pay for the taxi fares for the lawyers involved,” he said.
“What the ATO is trying to do with this measure is to limit the amount a trustee can spend with a lawyer or accountant on trying to manage your tax affairs, including preparing and lodging tax returns and obtaining tax advice, as well as any appeals to the AAT (Administrative Appeals Tribunal) or courts, and interest charges from the ATO.
“Accountants and lawyers are already going mad about this move and I think those two lobby groups may end up getting the limit changed.”
Shorte added SMSF trustees should be able to charge for costs related to managing their tax affairs if they were appropriate to the fund.
“I believe that if you feel you have an issue, or if you know you are correct in what has been done, that you have the right to take it to a tribunal or court, and the ATO, by this measure, is trying to limit that ability,” he said.