The ATO disqualified 80 SMSF trustees in the final quarter of the last financial year, with more than 250 trustees disqualified during the year, according to new data released by the regulator.
In an update to its Disqualified Trustees Register, the ATO stated the disqualification of 80 trustees between 1 April and 30 June 2022 led to a total of 252 trustees being disqualified during the 2022 financial year.
This number was an increase over the 191 trustees disqualified in the 2021 financial year and takes the total number of trustees disqualified over the past 10 years to 3616.
The second half of the last financial year saw more trustees disqualified – 165 – than the 87 in the first half of the year, with 54 disqualified in the first quarter, 33 in the second quarter and 85 in the third quarter.
The ATO stated disqualifying an individual as a trustee (or director of a corporate trustee) of an SMSF was one of the ways it dealt with non-compliance with superannuation laws or where the regulator considered a trustee was not a fit and proper person to continue managing a fund.
“Disqualification is not a decision we take lightly and we prefer to help trustees resolve issues before getting to this stage,” it said, adding trustees should use its SMSF early engagement and voluntary disclosure service where a contravention occurs.
“Every quarter, we update the Disqualified Trustees Register, which is publicly available. This register is regularly checked by SMSF professionals and can also be accessed by your employer and financial institutions.
“Once disqualified, a trustee must remove themselves from the role. If you have been disqualified and continue to act as a trustee, your auditor will report you to us and further penalties will apply.”
In July, the ATO released the reasons and circumstances that lead to the disqualification of trustees stating this would occur when some has shown deliberate and blatant disregard for superannuation law, a contravention of the rules cannot be rectified, and the SMSF has been misused to benefit from the favourable tax environment offered by the retirement savings systems.
