For one, among the professional SMSF community, there is a misconception that SMSFs will have to report their member account balances to the ATO on 1 July 2017.

However, ATO deputy commissioner for superannuation, James O’Halloran, explained the tax office doesn’t require SMSFs to report their members account balances and values of any income streams on 1 July this year.

“More broadly, the super changes do require certain events to be reported to the ATO. We are working with the SMSF sector to put in place transitional reporting arrangements in 2017-2018 to assist the sector to move to more timely events-based reporting for transfer balance cap purposes for the 2018-19 year and beyond,” Mr O’Halloran told SMSF Adviser.

“Transitional reporting arrangements in 2017-18 may mean that many SMSFs will not need to report anything further to the ATO for the purposes of the super changes until they are required to lodge their 2016 - 2017 SMSF annual return.”

Mr O’Halloran emphasised that the new transfer balance cap cannot be shared between couples, despite some believing this may be the case.

“The transfer balance cap of $1.6 million cap applies for each member of a couple, with modifications for death benefit recipients, and cannot be shared or aggregated between a couple,” he said.

Another misconception, which has begun circulating following the reforms’ announcement, is that there will be changes to the tax-free status of a pension.

“The change is a new limit on the amount of super you can transfer and hold in a tax-free retirement phase account, where the investment returns are tax free,” Mr O’Halloran said.

“There is actually no change to the pay as you go (PAYG) withholding status of ordinary account-based pensions.

“For most people over the age of 60, pension payments will continue to be tax free and not subject to PAYG withholdings.

“However, if they receive non-commutable capped defined benefit pensions and annuities, and exceed the cap, then they may be subject to PAYG withholdings.”

Further, Mr O’Halloran noted that some professionals believe that the transfer balance credit amount of an existing term allocated pension (TAP) will be determined by the TAP’s account balance, which is incorrect.

“The TAP is a capped defined benefit income stream and different rules are used to determine how the TAP counts towards an individual’s transfer balance cap,” he said.

“Instead, the credit amount is determined as the annual entitlement from the TAP multiplied by the rounded up remaining term, and this will always exceed the actual account balance.

“However, if your TAP commences after 30 June 2017, the transfer balance credit value will be equal to the value of the account balance.”