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2017
Super Success - Relief for up to 85% of SMSFs

Super Success - Relief for up to 85% of SMSFs

Super Success - Relief for up to 85% of SMSFs

The ATO has announced 85% of SMSF Trustees are no longer required to undertake the burden of additional reporting required from 1 July 2017 in "real time", allowing access to annual reporting.

The Super Reforms added additional reporting requirements to SMSF Trustees to enable the ATO to monitor members "Transfer Balance Cap" from 1 July 2017.

From 1 July 2018 those SMSFs that have members with total superannuation account balances of $1 million or more will be required to report events impacting members’ transfer balances within 28 days after the end of the quarter in which the event occurs.

Are you required to report quarterly?

SMSFs will not be required to report monthly as the ATO originally required (which was to apply from 1 July 2020).

Quarterly reporting will only apply to funds with members who have over $1m in "Total Superannuation Balances" (TSB).

Annual reporting can be chosen by those funds where all members have a TSB of less than $1m.

Is your fund ready for real-time reporting?

Each quarter, all transactions in the fund are to be accounted for as they occur to determine if any reporting is required.

If choosing to report annually you need to be certain you have met the requirements to make this choice. The TSB is determined by the balance as at 30 June of the prior year, however, the delay in determining this could see you being late in reporting.

Therefore regardless of when you report it is now essential that all SMSFs are able to track their status in real time.

What must be reported:

Starting pensions (except transition to retirement pensions)
Stopping pensions (except transition to retirement pensions)
Partially stopping pensions
Limited recourse borrowing arrangement payments
Personal injury (structured settlement) contributions
ATO commutation authorities (for when your transfer balance cap has been exceeded and the ATO directs the SMSF to stop part of your pension)

Where we look after your SMSF we are working hard to ensure your fund is ready for real-time reporting, including:

Determining the impact these requirements may have on your SMSF
Bringing forward completion of your annual accounts to determine your TSB
Adopting alternative methods including transition to Class to keep your fund up to date in real time
Working with you to ensure withdrawals from super result in the most positive impact on your Transfer Balance Cap and your Estate Plan

Where can you help?

Review your fund investments to determine if your product provider enables real-time access to their information
Contact your Grant Thornton adviser to discuss further