Butler- Self Managed Super Fund Changes

The Australian Taxation Office (ATO) is currently focusing on several key areas in regards to Self-Managed Superannuation Funds (SMSFs). These include:

  1. Non-arm’s length income (NALI): The ATO is scrutinizing SMSFs that receive income from non-arm’s length transactions to ensure that they are not benefiting from non-commercial terms.
  2. Retirement income streams: The ATO is reviewing SMSFs that provide retirement income streams to ensure that they are correctly set up and are being paid out in accordance with regulations.
  3. Related-party transactions: The ATO is monitoring SMSFs that engage in transactions with related parties to ensure that they are conducted on arm’s length terms and are not being used for personal gain.
  4. The ATO has been working closely with the Australian Securities and Investments Commission (ASIC) to monitor and regulate the conduct of SMSF auditors
  5. Limited recourse borrowing arrangements (LRBAs): The ATO is paying close attention to SMSFs with LRBAs to ensure that they are compliant with regulations and not using these arrangements for prohibited purposes.

And in addition, SMSF’s are being required to report more regularly to the ATO. For example:

  • Transfer Balance Account reporting in relation to pension set-up, commutations and other payments. 
  • Single Touch Payroll – where super contributions are now reported to the ATO by employers on a monthly basis.

Further, the ATO have indicated through their standard business reporting (SBR) project that they will be requiring more up to date access to accounting software on a regular basis.

In order to ensure our clients SMSF’s are meeting the requirements of the above mentioned areas, we will be moving to a system to have the SMSF accounts reconciled and closed off each month. In order to be able to achieve this, we will require the following items to be sent to us monthly:

  1. Bank statements: We will need to have the bank statements for all SMSF bank accounts for the month in question. These statements will show all transactions, including deposits, withdrawals, and fees.
  2. Investment statements: We will need to have the investment statements for all SMSF investments for the month in question. These statements will show any purchases, sales, and changes in value of the investments.
  3. Record of contributions: We will need to have a record of all contributions made to the SMSF during the month in question. This includes any contributions made by members or employers.
  4. Record of expenses: We will need to have a record of all expenses incurred by the SMSF during the month in question. This includes any fees charged by the SMSF’s service providers, such as the accountant or auditor.

Starting 1 July,2023, we will be moving our SMSF clients to pay our fees on monthly instalments. This means that you will pay your invoices in smaller, more manageable amounts over the course of the year.

We understand that this may be a change for some of our clients, but we believe that this system will offer many benefits for both parties. We will be able to provide more accurate project timelines and resources allocation. Importantly, it means your fund will be meeting its ATO reporting requirements. This system will also enable us to ensure timely project completion and a more efficient workflow.

Note however, that a bill for the current financial year will be issued in accordance with current terms.

Thank you for your continued trust in our services. We look forward to working with you under this new system.