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25 Mar 2021 Superannuation

Independence standards for tax professionals with SMSF clients

Recent changes to the independence standards may change the way tax professionals and approved SMSF auditors represent their clients. This may affect your practices and businesses.

The ATO has released guidance on the changes to the independence requirements under the Code. It is essential information for SMSF auditors and tax professionals. Review these changes to understand how they affect your practice and business and how you represent your clients.

Getting ready to lodge your SAR by 15 May 2021

Some SMSFs have their SMSF annual return (SAR) due by 15 May 2021. You will need to appoint an auditor no later than 1 April 2021, to meet the May deadline.

In preparation for your lodgment, you also need to complete a market valuation of all your assets, prepare your fund's financial statements and provide signed copies of these to your auditor so they can determine your financial position and your fund's compliance with super laws.

More information can be found here.

Your SMSF may have a TBAR due 28 April 2021

The transfer balance account report (TBAR) for some SMSFs is due by 28 April 2021.

The TBAR is separate from the SMSF annual return (SAR). This is one of your trustee reporting obligations.

Your SMSF is required to lodge a TBAR by 28 April 2021 if:

  • a transfer balance account (TBA) event occurred in your member’s SMSF between 1 January 2021 and 31 March 2021, and
  • any member of your SMSF has a total super balance greater than $1 million.

More information can be found here.

Trustee reporting obligations checklist

The ATO has published the Trustee reporting obligations checklist to help you finalise and lodge your SAR correctly. You can find the checklist here.

SAN misuse leads to termination of tax practitioner’s registration

Following one of the ATO’s SAN misuse mailouts, an SMSF auditor reviewed their client list and found there were funds listed that they did not audit. The SMSF auditor contacted the ATO and an investigation was carried out, which revealed further funds had not received an audit.

Over a period of nine years, Adamson & Cross lodged 125 SMSF annual returns and falsely declared the SMSFs had been audited when no audits had taken place.

The case was referred to the Tax Practitioners Board who decided to terminate the registration of Mr Cross on the grounds of misconduct and imposed a two-year non-application period. The registration of Mr Cross’ partnership, trading as M. Adamson and A. Cross (Adamson & Cross) was also terminated.

Read more here.

SAN misuse mailout to auditors achieves response rate of over 67%

The ATO recently issued a follow-up email to all auditors to serve as a reminder to reply to the SAN misuse mailout.

The ATO has emailed client lists for the 2019 income year to 4,899 auditors, which totalled 479,635 funds. The response rate was over 67% — the highest to date.

The responses helped to confirm that 287,459 funds received an audit by the auditor reported in the 2019 annual return.

Read more here.

Rollovers v3 Implementation Forum

On 25 March 2021, the ATO will be launching the Rollovers Implementation Forum (RIF) to support the implementation and onboarding of SuperStream Rollovers version 3.

More information can be found here.

Changes to SMSF rollovers and release authorities

From 1 October 2021, SMSFs will need to use SuperStream to roll over superannuation to or from their funds. SMSFs will also be able to receive and action certain release authorities electronically via SuperStream.

More information can be found here.

SMSF SuperStream information

The ATO has published the following information on SMSF SuperStream:

Reminder about Unclaimed Super Money reporting obligations and avoiding common errors

You have an obligation to report and pay your unclaimed superannuation money (USM) for the 31 December 2020 unclaimed money day by the scheduled statement date of 30 April 2021.

More information can be found here.

Unclaimed Superannuation Money Outcome Response messages

Superannuation funds who do not utilise Unclaimed Superannuation Money Outcome Response (USMOR) messages to reconcile their USM lodgments will get rejected messages and members will be prevented from viewing and accessing their USM entitlements.

More information can be found here.

2020 Superannuation postcode data now published

The ATO has published the figures for lost and unclaimed super money across Australian states and postcodes. This data highlights which postcodes and associated suburbs have the highest amount of lost super which is held by the ATO and unclaimed super held by super funds.

Some highlights from the report include:

  • All states significantly reduced their lost and unclaimed super holdings from the previous financial year.
  • New South Wales had the highest value of lost and unclaimed super with $3.4 billion, followed by Victoria with $2.2 billion.
  • Sydney’s inner suburb postcode 2000 had the most lost and unclaimed super.
  • North Queensland postcode 4870 had the second highest value of lost and unclaimed super.
  • As at 30 June 2020, there was $13.8 billion in lost super and unclaimed super. This is a reduction of $7 billion compared to 30 June 2019.

Read more here.

Eligibility for downsizer contributions to superannuation

Older Australians who meet the eligibility requirements for downsizer contributions can contribute up to $300,000 from the sale of their home into their superannuation. Find out more here.

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