ATO praises SMSF sector

ATO praises SMSF sector

The tax commissioner has praised the efforts of the SMSF Association and its members in implementing COVID-19 relief measures and ensuring trustees maintained their obligations in 2020.

The most senior figure in the ATO has praised the high level of compliance among the SMSF sector and the work of the SMSF Association (SMSFA) and advisers in assisting clients in meeting their obligations.

ATO commissioner of taxation Chris Jordan told attendees at the virtual SMSFA National Conference that the “robust and effective partnership” that has existed for many years between the regulator and the sector was evident in the tax performance of the latter.

“The latest tax gap for small super funds shows 97.5 per cent compliance – an outstanding result – and reported regulatory contraventions among SMSFs are currently tracking at around 2 per cent,” Jordan said.

That figure is consistent with previous years as noted by former ATO SMSF segment assistant commissioner Dana Fleming at the 2020 conference.

“I believe a key factor behind this is your willingness to work closely with us to achieve better outcomes for clients, but there is still work for the ATO to do,” Jordan added, pointing to ongoing work in ensuring only genuine trustees were able to establish an SMSF.

“During the 2020 financial year, 22,000 new SMSFs were registered, a 7 per cent increase on 2019, and of those, about one-fifth was selected by our risk models and then reviewed. As a result of our rigorous checks we protected an estimated $126 million from leaving the super system illegally.”

The tax commissioner also flagged that SMSF annual returns still remain an issue, with 14 per cent of returns for 2019 yet to be lodged, but noted this may be due to the impact of COVID-19 on trustees and the SMSF sector.

He also highlighted the high level of engagement between the ATO and SMSF sector in 2020 when the regulator was given added responsibilities for COVOD-19 relief measures, including early release of superannuation, and the sector’s response in implementing those change for SMSF clients.

“Our ability to deliver those [stimulus measures] was thanks in no small part to the community for their trust in us and industry associations such as yourselves,” he said.

“I know your work has only become more challenging in this past extraordinary year and that’s why I was so pleased that our strong working partnership never faltered.

“The SMSFA provide a crucial role representing the industry as we worked to implement the government stimulus measures. Throughout it all you remained engaged to ensure we provided you with the right support.

“I believe our existing strong partnership and formal statement of intent were vital in allowing us to work together productively and because of that cooperation and your dedication to your clients, I know many trustees have been able to keep making their obligations despite the circumstances.”

His comments echo those from Australian Financial Complaints Authority lead ombudsman Natalie Cameron, who said on day one of the conference that the dispute resolution service received a very low number of complaints related to SMSF advice, which was likely to be indicative of its high quality.

Copyright © SMS Magazine 2021

ABN 43 564 725 109

Benchmark Media

Site design Red Cloud Digital