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ATO, Tax

ATO confirms conciliatory TBAR approach

Silhouette of helping hand between two climbers representing ATO helping SMSFs

The ATO is treating late TBAR lodgements from an educational and supportive perspective.

The ATO has confirmed it is not taking a hard compliance enforcement approach when assessing transfer balance cap report (TBAR) lodgement at the moment.

“We’re currently taking an educative and supportive approach when an SMSF lodges late [regarding] one of those regular annual or quarterly TBARs,” ATO superannuation director Helen Morgan said during the regulator’s latest practitioner webinar.

“So if you haven’t met a deadline, and were working to lodge as soon as possible, you don’t need to seek a formal extension of time.”

Morgan pointed out this cooperative approach should not dull the importance of lodging TBARs on time as late lodgement could have adverse consequences even if no compliance action is taken by the regulator.

“You do need to be aware that any late lodgement of routine TBARs may adversely affect the individual’s transfer balance account and cause a reverse workflow for you [the agent], the member and the SMSF,” she warned.

As such, she urged practitioners to let their clients know what specifically might result from late TBAR lodgement.

“Some of the [consequences] may be the increased likelihood of inadvertent breaches because the individual doesn’t have a clear line of sight of their affairs, and an increased likelihood of an individual being in excess [of their transfer balance cap] for longer and having to remove more from retirement phase and pay more excess transfer balance tax,” she noted.

During the webinar, she also took the time to address the situation where only an SMSF member’s tax agent has access to the client’s transfer balance account data via the ATO online portal.

“I appreciate there is a level of frustration in the sector about this, but essentially it’s a matter of privacy. A TBAR is lodged in relation to the affairs of an individual member of the fund, so we store that information on an individual’s record and can only provide that information back to the individual or their personal agent,” she noted.

She said the only way people other than the member’s personal agent can access the information is for the member themselves to download the information and send it to the relevant parties.

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