Compliance & Regulation

Trustee disqualifications increase

SMSF trustees disqualified

The ATO has disqualified 130 people from managing an SMSF in the last quarter after disqualifying around twice that number in the previous quarter.

The ATO has disqualified 130 SMSF trustees in the December quarter causing the total number of disqualified individuals for the first half of the 2023 financial year to be four times higher than that for the first half of the 2022 financial year.

The regulator stated the disqualifications of these trustees, or directors of a corporate trustee, brought the total number of disqualifications to 389. By comparison the ATO had only disqualified 88 individuals during the first half of the 2022 financial year.

The disqualification figures for the December quarter are lower than those of the September quarter during which more than 260 people were disqualified. This number exceeded the total number deemed ineligible to be an SMSF trustee in the entire preceding financial year.

An examination of the most recent bannings, available on a public register, showed nearly 44 per cent of this cohort came from a single state and around 50 per cent were in an SMSF with their marriage partner.

Specifically, 57 disqualified trustees were recorded as living in New South Wales, followed by 22 in in Western Australia, 20 in both Victoria and Queensland, and 3 in South Australia, Tasmania and the ACT.

Of the 130 people barred from being SMSF trustees, at least 64 were in an SMSF with their spouse, as 32 couples with the same surnames were identifiable from the data. Another six trustees were in a family SMSF with two groups of trustees with the same surnames in each group, being identifiable from the data.

The ATO has added the names of those disqualified in the December quarter to the public register that includes the name of the individual trustees or director of a corporate trustee, their suburb and state, date of disqualification and a link to the formal notice of disqualification that was published in the Commonwealth Government Gazette.

The formal notice, sent by Deputy Commissioner of Taxation Emma Rosenzweig states an individual has been disqualified as they have contravened the Superannuation Industry (Supervision) Act on one or more occasions, and the seriousness of the contraventions provided grounds for the action taken.

In total, 4003 people are listed on the public register which has been in place since October 2012.


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