The SMSF Association has released a more detailed response to its stance on the reforms to the superannuation sector Assistant Treasurer and Minister for Financial Services Daniel Mulino announced last week at the National Press Club.
With regard to the seven specific measures relating to the SMSF sector, the professional body was in the main supportive.
Firstly, it offered broad support for the proposal to grant the ATO the power to prevent rollovers into SMSFs where the regulator suspects fraud, financial abuse, misconduct or potential harm is present.
However, the SMSF Association stipulated the relevant criteria has to be well defined.
“We note the ATO already has the power to decline registration if the trustee does not meet the registration eligibility or there are factors that indicate the SMSF applicant is not fit and proper to be a trustee,” it said.
Secondly, it rejected the idea trustees in the future will have to undergo mandatory education prior to establishing an SMSF.
“We do not support mandatory ‘one-size-fits-all’ education for all new SMSF trustees. We encourage the government to explore options to uplift trustee education and will work closely with government on measures which support informed decision-making,” it indicated.
Thirdly, it qualified its support for the proposed requirement to have trustees hold uniquely identifiable bank accounts for their funds, acknowledging some practical challenges will need to be addressed for the obligation to be satisfied.
With regard to having SMSFs formulate a written investment strategy when being set up, it favoured the measure, but again called for more details to allow a better understanding for what it would entail.
“Consideration must also be given to how we can improve access to advice for prospective SMSF trustees,” it suggested.
Finally, it confirmed broad support for the proposals allowing the ATO to gather more information about the parties directly involved with SMSF establishments and ongoing fee arrangements, aligning the supervisory levy with fund set-up and facilitating more support for the regulator to provide trustees greater visibility as how their funds are performing against their public offer counterparts.
Darin Tyson-Chan
Editor
Darin is the founder and publisher of Benchmark Media, an independent publishing house whose mastheads include financialobserver, selfmanagedsuper and smstrusteenews. He has been covering the financial services space for over a decade and in this time he has worked for a variety of trade publications. Darin has also written for the Money section published in The Sydney Morning Herald and The Age.
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