Self-Managed Super Fund Lodgement Date Incentives - What You Need to Know
If you have an SMSF, this article is for you. The ATO has recently introduced a new incentive to encourage on-time lodgement of SMSF returns.
From 1 October 2019, any SMSF that is more than two weeks overdue on their annual return lodgement due date, that hasn't requested a lodgement deferral, will have the Fund’s status on Super Fund Lookup changed to 'Regulation details removed'.
This will be assessed on the first business day of each month and will be applied to any fund that hasn’t lodged their SMSF annual return on time and are also more than two weeks overdue at that date.
When the outstanding return is subsequently lodged the SMSF will not be reinstated to 'complying' status until it is reassessed at the beginning of the next month.
So, what does all of this mean for SMSF members? on the practical side, it means that an SMSF won’t be able to receive any rollover amounts from other funds while the SMSF is not compliant. Perhaps more importantly though, it also means that employers won’t be able to make any super guarantee contribution payments to the SMSF until the fund is compliant again.
The delay with the employer contributions could quite foreseeably get messy, and the ATO has taken the step to suggest that members should alert their employer to make any SG payments into the employer's default super fund or another fund of the member's choice. Once the SMSF’s status has been restored to complying, members can request a rollover to their SMSF of any member benefits that may be held outside their SMSF.
Rather than directing employer benefits to another fund and then having to track them down once this has happened, we strongly suggest members are extra cautious about this, and take all required steps to get their SMSF lodgement in on time. That would save everyone a lot of bother.
If you’d like to discuss this more, please don’t hesitate to contact us. We’re only a phone call or email away.
*Photo by Glenn Carstens-Peters on Unsplash