Non-lodging SMSFs declared non-persons
The Australian Taxation Office will now treat a self-managed super fund (SMSF) that has two or more returns outstanding as a non-person, according to Super Central.
The ATO will remove their entry from the Who's Who of SMSFs, and in particular, Super Fund Lookup.
Super Central is concerned about the serious impact on the non-person SMSF including the ability to receive contributions from employers, rollovers and transfers. It will also mean non-lodging SMSFs will not be able to borrow for property.
"If the SMSF is trying to enter into a limited recourse borrowing arrangement, it will be an impossible dream to complete the transaction with such a black mark over the fund," it said.
"Strangely, there is very little legal redress available to the now ‘non-person' SMSF as the operation of the Super LookUp website is not a statutory function of the ATO — merely a public convenience, which the ATO provides at its grace."
Super Central warned funds to just avoid the situation of two or more overdue returns by lodging them as soon as possible instead of legally challenging the ATO's treatment of the non-personage of the SMSF under the Administrative Decisions (Judicial Review) Act 1977.
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