The Australian Taxation Office (ATO) has warned that Self-Managed Superannuation Funds (SMSFs) are neither "do it yourself" or "set and forget".
ATO Assistant Deputy Commissioner, Compliance, Strategy, Risk and Delivery, Superannuation, Stuart Forsyth has used an address to the Australian Investors Association annual conference to point to the rapid growth in the SMSF sector but to warn that self-managed funds require significant time, attention and expertise.
"The number of people with SMSFs has now passed one million. Those one million trustees are part of the largest and fastest growing sector of the Australian super industry," Forsyth said.
Citing the latest Roy Morgan research, he said that SMSF trustees also appeared to be pretty happy with themselves and that in the six months to May SMSF members' satisfaction rose about 2.5 percentage points to 75.6 per cent and remained well in front of industry and retail funds.
Forsyth also pointed to the new regulatory powers granted to the ATO via the the Tax and Superannuation Laws Amendment (2014 Measures No.1) Act 2014.
He said the new legislation had given the ATO three new regulatory compliance powers to deter and address non-compliance by trustees: education directions; rectification directions; and administrative penalties.
"If you come across a contravention, fix it. If it's too late, then talk to us," he said.
Forsyth said the worst possible thing and SMSF trustee could do was to try not to engage with the ATO.
"We will work with you to avoid the worst outcome where we can. Our primary interest is the compliance of the fund. For penalties to be imposed there will usually be an unrectified contravention or repeat contraventions that lead us to begin audit action," Forsyth said.
