There have been a lot of changes over the last 12 months for SMSF’s and this will continue with the introduction of “Events Based Reporting”.
As a result of the introduction of the $1.6m cap for member balances the ATO has introduced Events Based Reporting. This system requires Trustees to report specified events to the ATO within certain timeframes in order that the ATO can track individual member balances.
Trustees have until 1 July 2018 to be ready for this system, however we recommend you take the opportunity to get on board early so that you are prepared for the new reporting system.
Whilst not all Trustees will have transactions that need to be reported to the ATO we recommend that Trustees commence the move to real time reporting for their SMSF’s as soon as possible.
The most common transactions that need to be reported are:
- Commencing or changing a pension (28 days after the end of the quarter to report a pension commencement to the ATO)
- Drawing more than the minimum pension and commutation of pensions (10 days after end of month to report each commutation of your pension)
- Repayment of a limited recourse borrowing arrangement (28 days after the end of the quarter in which the repayment was made)
This reporting will be particularly critical when members have balances across a number of super funds.
If Trustees do not report by the required date you may be penalised or subject to compliance action. The reporting timeframes are quite soon after the event has taken place and without adequate record keeping processes it will be extremely difficult to meet them.
We suggest that Trustee’s start the process now to ensure your records are being maintained in a manner that will allow you to report easily within the required time frames.
We see that Funds already maintaining their records in this manner are more efficient, have up to date information on which to make investment decisions and spend less time with record keeping.
Hall Browns will be running a number of sessions for Trustees over the coming months in order that you can remain on top of your reporting obligations with the ATO.
DISCLAIMER: The information on this website and the links provided are for general information only and should not be taken as constituting professional advice from Hall Browns Accountants. You should consider seeking the appropriate legal, financial, or taxation advice to check how the website information relates to your unique circumstances.