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SMSF membership changes could hit ATO revenue
The Australian Taxation Office (ATO) is likely to see a reduction in the revenue it collects from self-managed superannuation funds (SMSFs) as a result of the Government’s legislative moves to increase the number of allowable SMSF members to six, according to the Taxation Ombudsman.
In a submission filed with the Senate Economics Legislation Committee, the Ombudsman noted that all SMSFs are required by law to pay an annual supervisory levy to the ATO to cover the ATO’s costs in educating and regulating the sector.
“Given that there are approximately 600,000 SMSFs, the ATO annually receives some $155 million in levies,” it said.
“The new law is likely to see a reduction in the number of SMSFs within the tax system which will correspondingly reduce the total revenue received by the ATO from the supervisory levy,” the submission said.
“The Committee may be assisted in assessing the financial and regulatory impacts of the proposed law change, by making enquiries with the ATO regarding:
- • any forecast reduction in the number of SMSFs as a result of the law change;
- • the corresponding reduction in the total revenue raised from the SMSF supervisory levy; and
- • the sufficiency of that revenue to enable the ATO to continue educating and regulating the SMSF sector.”
At the same time the Taxation Ombudsman’s submission suggested that there had been little pressure from within the SMSF community for the changes to the regime.
It said it had undertaken a general keyword search for complaints relating to SMSFs and that since 1 May, 2015 it had received approximately 200 complaints relating to SMSFs and that none had been about allowable numbers of SMSF members.
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Umm, that would be because the ATO would have a reduced number of SMSFs to supervise. Good grief!