Events-based reporting for SMSFs
From 1 July 2017, all superannuation funds, including SMSFs, will be required to report Transfer Balance Cap (TBC) credits & debits to the Australian Taxation Office (ATO) on an ‘events’ basis.
All superannuation fund providers, including SMSFs, will report TBC events via the Transfer Balance Account Report (TBAR). This will be done on an ATO approved form. The form will be lodged electronically or you will be able to post it.
The ATO has proposed that all superannuation providers, including SMSFs, will be required to report events occurring in relation to their member’s Transfer Balance Account 10 business days after the end of the month in which the relevant event occurs. This hasn’t been legislated yet and its open for discussion. At present the ATO has received negative feedback on this proposal.
There are some specific exclusions that will apply to the above timeframe;
- SMSFs – Commencement value of a member’s super income stream. SMSFs to report the commencement value of an income stream (new pension), 28 days after the end of the quarter in which the relevant income stream is commenced.
- SMSFs – Limited Recourse Borrowing Arrangements impacted by the 2017 budget measures
- All Funds – where needing to comply with a commutation authority the SMSF must notify the ATO within 60 days of the date of issue of the Commutation Authority.
The ATO has advised that TBAR reporting functionality will be available from the 1st October 2017. A transitional period will be allowed for SMSFs so that they will generally not be required to commence TBAR reporting until 1 July 2018 but functionality for TBAR reporting will be available for those SMSFs that wish to commence TBAR reporting before 1 July 2018. We recommend that you commence TBAR reporting right away as SMSFs will need to track all relevant transfer balance account events leading up to the date of lodgement of their first TBAR.
We have the resources to manage the new TBAR requirement efficiently and effectively.
If you would like to discuss the new TBAR requirement please feel free to call Cayle Petritsch or Martin van der Saag on 02 9984 7774.
Cayle Petritsch
SMSF Specialist Advisor
T: 02 9984 7774
E: caylep@nac.com.au
Martin van der Saag
Director
T: 02 9984 7774
E: martinv@nac.com.au
“Events-based reporting shifts SMSF compliance from an annual task to an ongoing responsibility.”
About the author
Marius Fourie - Director & Business Advisor
As Director and Business Advisor, Marius uses his accounting expertise and empathetic skills to work directly with business owners and help them feel at ease with their finances.
Marius saw a common need in clients that just wasn’t being met by accounting providers.
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Business owners just don’t have time to compare different accounting firms to see which one has the best packages with the best inclusions (many of which they would pay for but never use).
Key Takeaways
Reporting Is Now Ongoing, Not Annual
SMSF trustees must be prepared to report certain events throughout the year.
Transfer Balance Cap Compliance Is Central
Events-based reporting helps the ATO track how much super has moved into retirement phase.
Timing and Accuracy Are Critical
Delays or errors in reporting can trigger unintended tax consequences.
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Frequently Asked Questions
What is events-based reporting for SMSFs?
Events-based reporting requires SMSFs to report certain superannuation events to the ATO as they occur, rather than waiting until the annual return is lodged.
What events need to be reported?
Reportable events include starting or commuting a pension, changes affecting the transfer balance cap, and certain structured settlement contributions.
Who is required to comply with events-based reporting?
SMSFs that have members with retirement phase income streams or are impacted by transfer balance cap rules are generally required to report events.
How quickly do events need to be reported?
Timeframes depend on the event, but reporting is typically required within a set period after the event occurs to remain compliant.
What happens if reporting is late or incorrect?
Late or incorrect reporting can lead to excess transfer balance determinations, penalties and increased ATO scrutiny.
How does an SMSF lodge events-based reporting — is there a specific form?
Yes. These events are reported through the TBAR, which is an ATO-approved form and is generally lodged electronically (with a postal option also available).
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