In what appears to be a bid to crack down on all lax reporting, the Australian Taxation Office (ATO) has begun penalising start-up self-managed superannuation funds (SMSFs) for the behaviour of their trustees and members.
The ATO has specifically begun to look at individuals in regard to the lodgement of their personal tax returns.
"We've had some funds that have lodged to establish and they've had personal returns outstanding, and because there have been personal returns outstanding, the ATO would not issue the SMSF with a notice of regulation until the trustee had got their personal affairs in order," Cavendish Superannuation managing director Andrew Hamilton said.
The extent to which personal income tax returns are outstanding before triggering this type of reaction from the ATO is yet to be determined.
"In one case we had, the person hadn't lodged a return for 10 years. Now, in this case, the client was a nil taxpayer so there was actually no need to lodge a tax return, but they hadn't obviously advised the ATO of that," Hamilton said.
"We've only seen a couple of these and they involved people who hadn't lodged for a while, so whether they have put a set period in place I don't know," he said.
In addition, the ATO has increased its severity in pursuing the late lodgement of SMSF returns.
"With the non-lodgers among SMSFs, they are writing to the trustee and giving them some very serious deadlines to lodge, which historically they have never done," Hamilton said.
No taxpayer alerts had been issued to advise all concerned about these new initiatives either.
"Both of these actions came out of the blue," Hamilton said.
