Self managed super non-compliance is an important political issue in Australia and unfortunately a few bad eggs create difficulties for the rest of us.
Accordingly the ATO has recently been handed new powers to compel compliance by Self-Managed Super Fund (“SMSF”) Trustees with their duties and obligations. These are in addition to existing powers and they commenced as of 1 July this year. The new Penalty Regime provides the ATO with greater flexibility when dealing with a Fund’s non-compliance, including the power to:
- Issue rectification and education directives to Trustees of SMSFs; and
- Impose administrative penalties for Trustees for certain contraventions of the Superannuation Industry Supervision Act.
The Penalties
The below table is a summary of the primary administrative penalties that can be imposed on Trustees.
Self-Managed Super Non-Compliance Penalties
The penalties are applied to each Trustee separately and the Trustee cannot reimburse themselves from the assets of the Fund. For instance, if an SMSF has two Individual Trustees that have lent money to themselves, they can be fined $10,200 each. However, if those two Individuals were directors of a Corporate Trustee, it would be the Company that receives one $10,200 fine.
Our Aim is Education & Awareness
Many of these penalties are for offences that are administrative in nature so we as your advisers will continue to do all we can to ensure that our clients are aware of, and are therefore able to meet, their obligations.