The ATO has restricted access to its Super Fund Lookup (SFLU) service for 50,000 SMSF vehicles that have failed to lodge at least one annual return and has also taken action against nearly 1000 funds in relation to illegal early release (IER) of superannuation.
In statements released on the ATO’s website, the SMSF regulator reinforced the legal responsibility for SMSF trustees to lodge an annual return each year and on time, adding that where a fund had one of or more years of overdue lodgements, the ATO would remove the fund from SFLU and apply failure-to-lodge-on-time penalties.
“Over the past year, we’ve written to over 50,000 SMSF trustees advising them their lodgement is overdue and we’ve removed them from SFLU. We’ve warned these funds our next step will be to impose failure-to-lodge penalties,” it stated.
“We also advised these funds to consider whether they want to continue operating their SMSF and if not, we directed them to guidance regarding what they need to do to wind up their SMSF and avoid future lodgement, reporting and auditing responsibilities.”
It added it had also informed other superannuation funds and employers to not roll over benefits or pay superannuation guarantee contributions to SMSFs that have been removed from SFLU.
A further 352 SMSFs have been removed from SFLU and the registrations of 609 newly registered SMSFs cancelled following compliance work in the area of IER by the ATO.
The ATO stated the actions against the 961 funds represented around one- third of cases related to IER picked up by its risk models over the past year as part of a compliance campaign that targeted individuals and promoters who registered an SMSFs with the intent of using the fund to illegally access super benefits.
Earlier this year, the ATO and ASIC acted together to warn consumers about the actions of an unlicensed SMSF promoter, with the latter using its powers to prevent it offering any advice or assistance in relation to the establishment of SMSFs.
