The ATO have recently provided a reminder to both SMSF trustees and their auditors about the use of their voluntary disclosure service. This service is available for Self-managed Superannuation Funds (SMSFs) that have had a regulatory contravention that they have not been able to rectify yet.
The ATO are also alerting trustees of the fact that they don’t have to wait for their independent auditor to advise the ATO. Rather, trustees can use the ATOs SMSF early engagement and voluntary disclosure service to disclose their regulatory contraventions voluntarily. This provides a single entry point for SMSF trustees and professionals to engage early with the ATO on any of these matters.
Now, the ATO are not suggesting that trustees go it alone. They make it clear that if contraventions occur, trustees should work with their SMSF professional to create a rectification plan or undertake to rectify them as soon as possible.
The ATO make it clear that by trustees voluntarily disclosing unrectified contraventions before the ATO commence an audit, that disclosure will be taken into account in determining any enforcement action taken by the ATO. They also state that they will help to assist trustees to get back on track and to minimise any financial impacts of a contravention via assessing an appropriate reduction of administrative penalties.
It goes without saying, but the ATO also remind trustees that they must provide all the relevant facts, along with supporting documentation. They will also need to provide a rectification proposal or proposed enforceable undertaking, and must actively engage with the ATO throughout the resolution process.
Any outstanding SMSF annual returns must be lodged if trustees are making a disclosure about contraventions that may have happening in those prior years.