The ATO has highlighted some of the fundamental and recurring errors it is observing with regard to the SMSF annual return and the process involving the winding up of funds.
Speaking at SMSF Trustee Empowerment Day 2025, recently co-hosted by smstrusteenews and the SMSF Association, ATO trustee regulatory obligations director Paul Delahunty revealed: “One common error we do see is the annual return not providing all members’ information, such as names and TFNs (tax file numbers).
“We also see incomplete or inaccurate auditor details, including the auditor number and the date the audit was completed, [which are key integrity checks] for the lodgement process, so those details need to be absolutely accurate.
“Additionally, we see closing account balances not matching accumulation and retirement-phase account balance amounts.”
To this end, Delahunty stipulated if a member’s closing account balance is zero or negative, then an amount of zero must be entered on the SMSF annual return.
He also took the opportunity to point out some administrative errors frequently occurring when trustees are looking to close their SMSFs.
“While the concept of winding up [a fund] seems simple on face value, there are some compliance and tax obligations you will need to consider,” he advised.
“Some areas we are seeing trustees come unstuck include not making sure they dispose of fund assets in accordance to super law and the trust deed, not distributing member benefits and [when they are distributed] whether [the members] have met a condition of release and not checking whether they’ve met a condition of release. If [the member has not met a condition of release], you must roll over the benefits to another complying super fund using SuperStream.
“And thirdly, trustees forgetting they still need to have their fund audited and need to lodge the final SMSF annual return.”
He issued a reminder that the ATO has a checklist for SMSF wind-ups on its website to provide assistance with the procedures to be followed when a fund is to be closed down.
