The SMSF community has expressed its approval of the announcement from the ATO as to what the rules governing total account balance reporting (TBAR) for superannuation funds will be.
The regulator confirmed recently SMSFs with members who have total super balances below $1 million can choose to report events impacting on their members’ total balances as part of the fund’s annual return.
In addition, the ATO stipulated SMSFs with members who have a total super balance of $1 million or more will have to report any event affecting a member’s total balance within 28 days of the end of the quarter in which the event took place.
The SMSF Association welcomed the announcement and said it demonstrated the regulator’s willingness to work with the industry and properly take into account its concerns.
“The association proposed, and the ATO agreed to, a $1 million superannuation balance threshold for individuals, reducing those receiving a pension and having to report by about 85 per cent,” SMSF Association chief executive John Maroney said.
“This large potential compliance burden has been reduced for SMSF trustees and their accountants and advisers. Hence, this will further help facilitate the successful implementation of the transfer balance account report.”
Maroney also applauded the ATO’s decision not to proceed with a transitional period before more onerous reporting timelines would apply, saying the move provides greater clarity for trustees and their advisers.
The Self-managed Independent Superannuation Funds Association (SISFA) also expressed its pleasure at the outcome and said it was pleased to have had the opportunity to work closely with the ATO to achieve a more practical outcome than the original reporting proposal, under which all SMSFs would have suffered an unnecessary and costly compliance burden.
In a statement, SISFA said it hoped this would lead to further collaboration to formulate more sensible outcomes in the future.
The Institute of Public Accountants also commended the regulator for its decision.