ATO's SMSF crackdown sees 149 trustees disqualified
The Tax Office says it will continue to take “firm action” against those who persistently fail to meet their obligations.
The ATO has disqualified 149 trustees for the December quarter and says it will continue to take “firm action” against those who continue to break the law.
The latest disqualifications mean the ATO has barred 374 trustees in total for the second half of 2023.
“For the December 2023 quarter we disqualified 149 SMSF trustees which have now been added to the disqualified trustees register,” it said in a statement on Thursday.
The ATO bans SMSF trustees if they fail to comply with super laws or if they are unsuitable to be a trustee.
Consequences for disqualified trustees included never being an SMSF trustee again and their name going on public record, the ATO said.
Details of the disqualification could also come up in background checks, affecting their personal and professional reputation.
The compliance activity is the result of the ATO making good on its promise to ramp up scrutiny on SMSFs.
It announced in September that it disqualified a record 753 trustees in FY2023 and imposed $29 million in penalties. Compared to 2022, its compliance actions resulted in six times the amount of tax and penalties being imposed and more than triple the number of disqualifications, it said.
The ATO said the record sanctions were due to an increasing number of trustees who breached super rules, such as failing to audit and lodge annual returns, as well as taking money out prematurely before meeting a condition of release.
After the latest round of disqualifications, the ATO said trustees who breached super laws should rectify their contravention “as soon as possible”.
“Otherwise, you are putting your retirement savings and fund's complying status at risk,” it warned.
Trustees should consider using the SMSF early engagement and voluntary disclosure service, the ATO said, adding that it would take into account if trustees disclose breaches voluntarily before it commenced an audit.
“We continue to take firm action against trustees who persistently fail to comply with their obligations,” it said.
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