The need for trustees of self-managed super funds (SMSFs) to get professional advice has never been more important, according to the SMSF Professionals' Association of Australia (SPAA).
The statement follows an announcement by the Australian Taxation Office (ATO) during its Compliance in Focus briefing that it will increase its monitoring of the sector.
More specifically, the ATO said it intended to increase audits of SMSF trustees for both their regulatory and income tax compliance, with 1100 funds to be audited for income tax compliance and 15,100 funds for regulatory compliance in 2013-14.
Jordan George, senior manager, technical & policy for SPAA, said that it was now critical that SMSF trustees were aware that the running of their SMSF would be under even greater scrutiny going forward.
"The ATO are specifically targeting prohibited loans, related party transactions, SMSF return lodgement and funds with a history of non-compliance," he said.
"In this environment, SMSF trustees need to ask themselves, are they getting the best possible advice and if they aren't, is it worth risking their fund's complying status?
"Being made non-complying can severely damage trustees' retirement plans as their fund loses its superannuation tax concessions."
According to George, the ATO Overview also highlighted the fact that, despite the decision to increase monitoring, the vast majority of the SMSF sector continued to comply with the law.
"The ATO reports that 98 per cent of SMSFs complied with the law in the 2012-13 financial year," he said.
"This confirms what SPAA has been saying — that the SMSF sector is a healthy, compliant and well-functioning sector of the superannuation industry, simply confirming what the Cooper Review stated in its final report in 2010."
Originally published on SMSF Essentials.
