The ATO has clarified its stance on two-fund strategies used by SMSFs and whether this approach will give rise to the regulator’s scrutiny, following continued concerns from the industry.

The latest ATO figures have revealed the value of retirement savings considered lost or unclaimed is now close to $18 billion across 6.3 million accounts as at 30 June 2017.

The ATO has declared it will be closely scrutinising any apparent changes in the use of reserves in response to the newly imposed transfer balance cap and total super balance.

The SMSF Association has called on the ATO to adopt a practical approach regarding the introduction of the transfer balance account report (TBAR) and in doing so has thrown its support behind the proposed ‘option 2’ method of reporting.

It is important for SMSF trustees to ensure their funds do not exceed the newly implemented transfer balance cap (TBC) due to the restricted parameters the ATO has to operate under when enforcing this requirement, the regulator has said.

While the ATO has not budged from its stance of requiring any SMSF entirely in pension phase to use the segregated method when claiming exempt current pension income (ECPI), it has confirmed its compliance activities will not be focused on adherence to this edict for the 2017 financial year or any prior periods.