The government should seek to implement the parts of the Modernising Business Registers (MBR) program that would have delivered better administrative efficiencies and data security for company directors, including SMSF trustees, to avoid complicated rectifications from errors, the SMSF Association (SMSFA) has stated.
Noting the government’s decision to cancel the MBR program, which was to bring all corporate registers and registry functions under one body, the SMSFA said one of its aims was to streamline the way in which details were registered, viewed and maintained, which would have benefited corporate trustee SMSFs.
Association chief executive Peter Burgess said there was potential in the MBR program and it should be taken up in future projects under consideration by the government.
“With around 400,000 SMSFs with a corporate trustee, it was envisaged the consolidation of the director ID and the Australian Securities and Investments Commission’s (ASIC) core business register would deliver better data linking, improved security and ultimately an uplift in data integrity for the SMSF sector,” Burgess said.
“For example, there have been instances in the past where ASIC has deregistered the corporate trustee of an SMSF because changes to the trustee’s contact details have not been updated across all company registers and ASIC has been unable to notify directors of overdue annual review fees.
“Reinstating the company in these situations is not a straightforward task and it was hoped with better data linking, scenarios like this could be avoided.”
He noted with the government moving away from the MBR program and focusing its technology spending in other areas, it should review access to client data through the ATO’s portals, which is currently unavailable to licensed financial advisers and administrators seeking to access client data.
Currently, only registered tax agents can access total superannuation balance and transfer balance cap information for clients from the ATO portal, yet they are not licensed in many cases to provide personal financial advice.
“In contrast, a financial adviser who is licensed to provide personal financial advice must rely on their clients accessing this data via MyGov and then sharing this information with them,” Burgess said.
“This has a significant impact on the timeliness and efficiency of advice and erodes the trust established between client and adviser,” he added, noting the current regulatory framework was inconsistent with government moves to improve access to affordable financial advice.