Property, Tax

SMSF valuers create shield against ATO penalties

The use of a qualified SMSF valuer can shield trustees from ATO penalties stemming from incorrect market valuations of their fund assets, an SMSF valuation expert has said.

Speaking on a recent episode of the I Love SMSF podcast, Australian Valuers Institute board director Vincent Romeo said enlisting the services of a qualified valuer would help trustees ensure they were compliant with the ATO’s requirements relating to valuations for SMSF assets.

Romeo noted using a qualified valuer to appraise a fund’s assets, particularly in regard to more complicated assets such as property, was a potential safeguard for trustees against the penalties associated with incorrectly valuing the assets of a fund.

“When you consider the taxpayer penalties of anyone who incorrectly reports their tax or uses someone who’s not necessarily qualified to provide these valuations, there are certain penalties that will apply,” he said.

“You’ll generally find, if you’re using a qualified valuer or equivalent professional for tax purposes, you’re not going to be liable for any penalties as long as you’ve provided the valuer with the accurate information, even if the valuation ultimately proves to be deficient.”

He also highlighted the importance of timing when valuing the assets of an SMSF and recommended market valuations be conducted as close to the end of the financial year as possible.

“As you know, the Australian tax year ends on the 30th of June and valuations completed too far from that date are less reliable as the market’s quite volatile,” he said.

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