“In May 2016 when the super reforms were first announced, Treasury stated 96 per cent of Australians would be unaffected by the changes. BGL believed, at that time, 10-15 per cent of SMSFs would be caught up in these changes,” said Mr Lesh.

“[Given that] 48 per cent of SMSFs are in retirement phase, this means approximately 290,000 SMSFs will need to monitor and comply with the transfer balance cap requirements adding significantly to SMSF administration, audit and advice costs. These costs are already starting to bite.”

While the ATO believes most funds start a pension once and after that there are no further reportable events, the BGL managing director said that their analysis of SMSFs from over 3,000 clients indicates this is not the case.

“Whilst not all SMSFs have completed their administration work for this period, our research found 25 per cent of funds had at least one TBAR reportable event and over 50 per cent had multiple TBAR reportable events,” said Mr Lesh.

“If you extrapolate this to the total number of SMSFs, at least 150,000 SMSFs would need to report to the ATO in 2017/18. And with many pension strategies involving regular pension resets, this number in our view would repeat or even increase in future years.”

SMSF administrators, Mr Lesh said, will also be impacted as they’ll need to review all the funds they administer on a regular basis to determine whether TBAR reporting is required, which will add huge costs to SMSF administration that will be borne by SMSF trustees through higher fees.

“This is further exasperated by the ATO’s wish to have all SMSFs provide TBAR reporting – whether member balances are $150,000 or $1 million. Really this is just overkill – big brother really does seem to have gone mad.”