The ATO has revealed a new strategy to counteract schemes encouraging illegal access to superannuation through the establishment of SMSFs.
The SMSF regulator stated it would protect Australians’ retirement savings by increasing awareness of illegal access to superannuation schemes, reviewing all new SMSFs before allowing them to be listed on its Super Fund Lookup (SFLU) facility and working with Australian Prudential Regulation Authority (APRA)-regulated super funds to improve the rollover process.
“Implementing these steps will help prevent the transfer or rollover of funds to SMSFs created for the purposes of illegally accessing super,” the ATO said.
Highlighting its new registration process designed to prevent non-legitimate SMSFs from being listed on SFLU, it said the process could result in a new SMSF taking up to 21 days to appear on the register as a regulated fund.
“We have updated SFLU to provide clearer information about the complying and regulatory status of SMSFs and to identify SMSFs that we have concerns about,” it added.
It also pointed to a new member verification system intended to provide a higher level of transparency for super rollovers from APRA-regulated super funds into SMSFs.
“This new system allows APRA-regulated super funds to confirm that an individual is a member of the SMSF as part of the transfer or rollover process,” it said.
“This should reduce the need for APRA-regulated super funds to request copies of documents such as the SMSF’s trust deed or other membership verification documents.”
It called on APRA-regulated funds to refer to updated guidance from the prudential regulator on managing the risk of rollovers and transfers to SMSFs when receiving a transfer or rollover request.
Earlier this week, ATO SMSF future client experience director Edward Chung addressed the regulator’s continued efforts to restrict illegal early release to superannuation via SMSFs.
