The ATO disqualified more than 220 SMSF trustees over the September quarter, pushing the total number of banned trustees for the year to nearly 600, according to new data released by the regulator.
An update to the ATO’s Disqualified Trustees Register showed the regulator banned 223 trustees over the three months under subsection 126A of the Superannuation Industry (Supervision) (SIS) Act.
While this number represents a slight decrease from the September quarter in 2022 when the ATO disqualified 256 trustees, it brings the number of disqualified trustees in 2023 to 590, surpassing the mark set over the entirety of 2022.
Of those disqualified, 91 were based in New South Wales and 62 were from Victoria, representing over two-thirds of the sanctioned fund members. Additionally, over 56 of those disqualified were trustees of SMSFs established either with their spouse or family.
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.
To that end, the majority of the disqualifications were issued for one or more breaches of the SIS Act.
“We continue to take firm action against trustees who persistently fail to comply with their obligations and seriously breach the superannuation laws,” the ATO stated.
“If you are a trustee who has breached the superannuation laws, we recommend you rectify the contravention as soon as possible. Otherwise, you are putting your retirement savings and fund’s complying status at risk.”
The regulator urged trustees to proactively report any violations through its SMSF early engagement and voluntary disclosure service, highlighting it would take into account such action when considering disqualification.