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SMSF firms falling behind on annual returns
The complexities of dealing with the CGT relief and coping with other regulatory changes is slowing down the processing of SMSF annual returns, and could see accountants seeking another lodgement extension from the ATO, says an industry consultant.
Speaking to SMSF Adviser, Darren Wynen from TaxBanter and Insyt said many of the SMSF firms he’s spoken to recently are moving at a much slower pace this year in processing their clients’ SMSF annual returns.
“Certainly the professionals I’ve spoken to are behind their schedules compared to where they were at this time last year, and they’re just concerned that with the added complexity that they’re going to require an extension of time,” said Mr Wynen.
This is mainly due to the fact he said that SMSF practitioners are still getting their heads around the CGT relief, and also some of the legislative changes that were made this year.
“Practitioners obviously want to make sure that it’s all correct and there’s a number of steps that need to be done, especially for those clients who were over the $1.6 million transfer balance cap,” he explained.
“A lot of clients with TRISs are now stopping those income streams. There are just a lot of general changes that professionals are dealing with for the first time this year.”
Earlier this year, the ATO extended the due date for the lodgement of SMSF annual returns for the 2015-16 financial year, with many SMSF practitioners grappling with the superannuation changes and ATO outages.
“Traditionally, where the ATO is looking to grant an extension, we don’t necessarily know till later in the piece, but we’d certainly be hoping that the ATO will perhaps announce earlier that they’ll grant an extension of time in relation to tax agents lodging their SMSF tax returns. That would at least take some of the pressure off,” he said.
Miranda Brownlee
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.
Funds that rely on franking credits for a part of their income want to see earlier rather than later it is a challenge that must be met.0- Consolidation of the sector has led to a decline in service standards. The so called industrialisation has forced down prices & reduced profit margins.
Accordingly there has been a move to reduce costs, close down local operations & offshore to organisations with less experienced staff.
In an effort to claw back revenue large administration offerings are now focussing on products that include a FUM / income stream to the administrator.
Nowhere has there been a focus on service. Trustees & advisers are crying out for better service. It is the key to long term growth .
If you provide excellent servic then revenue & profitability will follow0- A smart man used to say "a fund a day". 200+ fund per administrator per year in the days before data feeds.
Where is this visionary today0- I know that man. He also used to say "your bonus is that you have your job".
Unfortunately there are fewer bonuses available onshore in today's cost conscious world0
- I agree there should be penalties against administrators that consistently fail to meet the lodgement standards.
For far too long have the ATO has failed to take head on the big name administrators
Does anyone remember the NAB MLC debacle0 - The industry should have been on top of this. Excuses are meaningless when your fund is in accumulation mode with member balances less than the cap.
Service in this sector has continually declined over the years yet the ATO does nothing, just gives extensions to lodge.
It's about time the ATO started issuing late lodgement penalties against the administrator rather than the trustee.0- I strongly disagree with that last statement. As an administrator, I have only one client that has been lodged late. It is 100% the fault of the client not providing information or responding to numerous and regular follow ups.
I do however agree with the first. Very few clients are significantly affected by the changes and required extra work. We are actually ahead due to changing to a more efficient administration platform.0- Elaine, I would modify my recommendation to include penalties for administrators with consistent poor lodgement performance0
- I see, thank you for clarifying. In that case I agree. There is really no excuse.0
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