Choice fails to ignite SMSF adoption
By Mike Taylor
The new choice of superannuation fund regime has failed to accelerate the growth of self-managed superannuation funds (SMSFs).
This much has been confirmed by the AustralianTaxation Office (ATO), with assistant deputy commissioner Ian Read using a recent address to reveal that while the ATO had expected choice might accelerate growth in the number of SMSFs, this was not the outcome.
“In the quarter to September, growth rates have slightly declined in comparison to the same period last year [2004],” he said.
Read said that the ATO’s major concern was not the actual number of funds created, but rather the ability of those funds to comply with the relevant regulations.
He said the rapid growth in the number of self-managed superannuation funds being established in Australia had recently declined to around 2,000 a month.
“And this figure is slowly trending down,” Read said.
“It could be that there is now more awareness in the community about the skills and commitment required to run your own fund,” he said.
Read said the ATO would be adopting two main approaches with respect to its compliance program for self-managed funds — lodgement compliance and active compliance.
“We will be focusing on lodgement compliance. All superannuation funds must lodge a fund income tax and regulatory return and a superannuation member contribution statement every year until the fund is wound up,” he said.
Read said a significant number of funds would be contacted in 2006 about non-lodgement and that the ATO had upgraded its resources in this area.
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