Mr Fernandez said this can sometimes be a problem where the fund has not been finalised properly from the year before, as it means the minimum amounts for the current year may have been calculated incorrectly.

“Also, if the member has jumped from 74 to 75, for example, there’s going to be an increase in the percentage that needs to be drawn down, which they need to bear in mind,” he added.

“That increase in the pension percentage is something you need to plan for, because you need to ensure you have the liquidity in the fund to be able to take that money out.”

Speaking in the same webcast, Smarter SMSF chief executive Aaron Dunn stressed that the failure to withdraw the minimum where it’s a reversionary pension is particularly problematic.

“Failure to take the minimum pension on a reversionary pension is a diabolical outcome because, if you can’t take a pension, then you are forced to take a lump sum. So, it’s absolutely critical,” he cautioned.

Given the transfer balance account reporting requirements, Mr Dunn said the timeliness of when pensions are started is also important now.

“An accountant might say, well, the optimum tax position is to go back and say that there was an oral decision or a request to say that it was done on 1 July, but if we’re in April or May, well, that actually needed to be reported by 28 October,” he explained.

“So, there’s actually a strategic decision that needs to be made around the timeliness of when that pension starts, so it might not be that we’re trying to max out the tax effect of that particular year.”

Mr Dunn also reminded SMSF practitioners that the ATO has updated its market valuation guidelines on its website in respect to how it deals with events.

“You don’t actually need the account balance at the time if you use fair and reasoned process to deal with that,” he said.