Taxpayers Australia has flagged the increasing surveillance of the SMSF sector, reiterating the consequences for SMSF trustees when the ATO identifies breaches of the SIS Act. 585 SMSF trustees were disqualified in 2014 compared with 100 in 2010. This signals that the ATO believes they have spent enough time educating SMSF trustees, and now the focus is on penalising as opposed to warning SMSF trustees who they believe should know better by now.

The ATO now has access to broader avenues for information, and its data-matching capabilities continue to grow stronger. This will only increase when the ATO has completed the process of implementing standard business reporting (SBR). SBR will give the ATO access to real-time data from people’s accounting systems, meaning the ATO will receive information sooner and become more agile in acting upon it.

The take home message for trustees of SMSFs is to be aware of your responsibilities as trustees of your self-managed superannuation funds, and to stay on the right side of the SIS Act. The penalty regime introduced 1 July 2014 is being enforced by the ATO, and scale of the penalties makes for a very good disincentive.