Following reforms to the superannuation funds and the capping of pensions, the Australian Taxation Office (ATO) have now brought in measures requiring trustees of self-managed superannuation funds (SMSFs) to report events affecting individual members’ Transfer Balance Caps (TBCs) in ‘real time’ from 1 July 2018.

The ATO have developed a new form, called ‘Super transfer balance account report” (TBAR) to capture the information necessary for it monitor the member’s balances and their pension caps.

Under the new ‘event-based reporting’ framework, SMSFs will need to complete and lodge a TBAR for a period. If a member’s total superannuation balance(s) are less than $1 million, they will need to report annually when they are due to lodge the fund’s annual return. Alternatively, if a member’s total superannuation balance(s) are greater than $1 million, the fund must report quarterly within 28 days after the end of the quarter in which the event occurs. It must be noted that the member’s balance is inclusive of all Funds that each member is a member of.

It is important to note that the events based reporting only applies to funds which have at least one member receiving a ‘retirement phase’ superannuation income stream and an event occurred.

The events which are captured are:

  • When an SMSF complies with a commutation issued by the Commissioner;
  • When an SMSF member commences an income stream;
  • When there is a partial commutation of an SMSF member’s entitlement to an income stream;
  • When an SMSF member ceases an income stream; and
  • When an SMSF member’s entitlement to an income stream arises from a structured settlement.

Pension payments, Investment earnings and movement in pension asset values are not an event requiring reporting.

In the year ending 30 June 2018:

The ATO have announced a lodgement concession for eligible SMSFs. While the implementation of the events- based reporting will not occur until 1 July 2018, the SMSF must report the value of any pre-existing retirement phase pension to the ATO on the TBAR on or before 1 July 2018, where the income stream:

  • Continued to be paid to the member on or after 1 July 2017, and
  • Is in retirement phase

TBC reporting events that occurred during 2017-18 year are required to be reported from 1 July 2018 at the same time the SMSF’s first TBAR is due, which for those reporting annually will be at the same time as their annual return is due. However, SMSFs reporting quarterly will have their first TBAR due 28 October 2018.

 

SMSF Trusteestake note.Trustees that fail to lodge the TBAR on time are liable to pay an administrative penalty, currently $210. This applies every 28-day period, or part thereof, the TBAR is lodged late.

If you are unsure if you meet the criteria please contact Mark Calleja Accounting at mark@mcaccg.com.au