The ATO has confirmed it will not take a hardline enforcement approach to SMSFs that do not comply with the new SuperStream requirements set to be implemented on 1 October this year even though funds in this predicament will be considered to have committed a regulatory contravention.
“Not complying [with the SuperStream requirements] is a breach of the payment standards and penalties may apply. However, like any new functionality and change, the ATO wants to support those impacted and therefore will allow a transition window for the industry to get up to speed and understand SuperStream,” ATO superannuation and employer obligations director and rollover project manager Belinda Black told SMSF Association technical manager Mary Simmons during a recent video interview.
“As always though we will monitor behaviour and if necessary scale up our compliance activity.”
Black illustrated the regulator’s attitude toward SuperStream compliance further when asked about SMSFs being wound up without having the proper payment standard protocols in place. The example put to the ATO officer was the enforcement action that would be applied to a fund commencing its wind-up in October this year, not being SuperStream compliant, with the process only being completed in May 2023.
“[For] that specific scenario, it’s unlikely we would take compliance action. However, we would record the details still, continue to monitor all SMSF rollovers, and determine whether the risk increases and make an assessment based on that,” she said.
According to Black, the regulator is also in the process of preparing content to assist auditors in understanding their responsibilities around the new payment standards.
Simmons welcomed this initiative given the new SuperStream requirement is a significant operational change being made to the sector.
“That’s good to know because this is a big adjustment for the SMSF industry and it’s also really important to recognise that SMSF auditors will be getting some more specific material [as] it’s important for them to have a clear understanding of their role when it comes to SuperStream rollovers,” Simmons said.
During the session, Black pointed out some SMSFs currently using an external administration service may already be SuperStream compliant.
