Manual tax return won’t hasten wind-up

A sector specialist has advised against lodging a manual or paper tax return in order to accelerate the winding up of an SMSF if the process is taking place in the weeks leading up to 30 June.

The recommendation came in response to a webinar question as to whether or not this would be a prudent course of action as preparing and lodging an electronic tax return might prolong the process for months into the following financial year.

“What I would say, if we are talking about [31 May at] this point in the year, I’d almost be inclined to wait [and use the electronic return],” Accurium senior SMSF educator Anthony Cullen told attendees of a technical webinar hosted yesterday.

“The reason why I’d say at 31 May I’d probably wait [and file an electronic return later] is that when you lodge a paper form, the [ATO’s method] to process a paper return is going to be so much longer than what it is for [the regulator] to process an electronic return.

“So you might feel that you’re jumping the gun and getting in early, but when you’re only a month away from the end of the financial year, having an electronic version of the 2026 return available may actually [make it worthwhile] waiting.”

Cullen acknowledged if the trustees are looking to wind up an SMSF in August or September, submitting a final tax return manually could be prudent to expedite the process to not allow it to extend too far into the subsequent income year.

According to Cullen, lodging a manual return just prior to the end of a particular financial year would be cumbersome for practitioners and trustee alike, lending to the argument to refrain from doing so.

This is because the parties involved would have to physically hand write changes to the headings on the previous year’s tax return form in order to make it applicable to the current income year, he pointed out.