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Accounting deadline dropped

SMSF accounts deadline

Treasury has abandoned a controversial proposal to introduce a deadline forcing an SMSF to finalise its accounts weeks before their lodgement.

A Treasury proposal requiring an SMSF to finalise its financial statements and accounts 45 days prior to lodgement of the fund’s annual return has been dropped from new amendments to the Superannuation Industry (Supervision) (SIS) Regulations.

The proposal, which appeared as item 67 in the exposure draft for the Treasury Laws Amendment (Miscellaneous and Technical Amendments) Regulations 2020 released on 21 October, is not present in the version of the amendment that was registered on 14 December and appears on the Federal Register of Legislation as “In force – Latest Version”.

An additional item in the exposure draft – item 70 – which detailed when the proposal would apply to an SMSF, is also absent from the currently registered version of the amendment regulations.

With the proposal not carried through to the in-force regulations, SMSFs will not be required to meet any time frame as the SIS Regulations do not prescribe any time by which financial accounts must be finalised before annual return lodgement.

The news was welcomed by SMSF Association deputy chief executive Peter Burgess, who commented on Twitter: “Some amended SIS regs were released yesterday. Looks like Treasury has dropped the proposal to require #smsf to finalise financial statements 45 days prior to lodgement. Good result.”

The proposal was open to consultation from 21 October to 17 November and had taken the SMSF sector by surprise, sparking concerns SMSFs unable to meet the new time frame may back-date records.

The Tax Institute said the proposed time frame appeared to be designed to impose a penalty model from the ATO where none was required, while CPA Australia and Chartered Accountants Australia and New Zealand claimed the proposal did not make clear what problem it was trying to solve.

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