The Australian Tax Office (ATO) is taking a more serious approach to SMSF non-compliance over the coming year.
The Tax Office has found that more than an acceptable number of SMSF trustees are lacking transparency and are operating of the system, i.e. not lodging SMSF annual tax returns and/or not undergoing an annual independent audit.
Compliance issues, such as regulatory contraventions reported through auditor contravention reports are a growing problem. The 2015 income year saw 22,000 auditor contravention reports reported for 8,200 funds.
The ATO is urging trustees to engage with the Tax Office by self-correcting and rectifying compliance issues through the early engagement and voluntary disclosure service and/or from targeted mail outs.
The Tax Office’s approach will focus on more intensive compliance activities and enforcement outcomes, especially for those trustees who:
Are deliberately not complying with their obligations
Are not willing to engage with the ATO, and
Are adopting aggressive income tax positions, such as dividend stripping arrangements.