Leading SMSF Tax Lodgment Times

SMSF trustees who have failed to meet the ATO’s stringent superannuation and tax rules can be dealt harsh consequences. Yet according to the ATO, approximately half the nation’s SMSF trustees have not completed their annual returns for the last financial year.

Conversely, CA SMSF Specialist and Director of E&P, Nicholas Antoni, says the E&P SMSF accounting team have lodged over 92% of their self-managed super fund tax returns for all ongoing clients for the last financial year as of the end of April 2023, compared to only 51%  of SMSFs reporting the completion of their tax lodgment according to the ATO.

E&P SMSF has a team of highly credentialled accounting specialists who solely focus on self-managed super funds. This dedicated focus allows us to partner with clients or other financial/investment advisers or accounting firms to ensure SMSFs:

• Remain up-to-date with all compliance rules
• Proactively notifying clients of upcoming EOFY requirements
• Help ensure that clients are not at risk of suffering penalties or regulatory consequences—including fund non-compliance

With only half of the 2022 financial year SMSF accounts lodged on time, it’s evident that many are struggling to meet requirements. And the numbers are significant.

Per the SMSF Adviser, The ATO announced approximately 40,000 SMSF annual returns relating to the 2021 income year and 21,000 relating to the 2020 income year remains outstanding.

Trustees must arrange an audit for all outstanding income years and lodge the returns as soon as possible to avoid the imposition of penalties and other regulatory consequences that is a disqualification of SMSF trustees.

ATO announcements

SMSF Adviser also referenced the ATO’s reminder: “All SMSFs are required to have completed an audit for the 2022 income year by the 15th of May 2023, which is the final lodgment due date for the 2022 annual return unless they have been granted lodgment deferral. If the SMSF has no tax liability, they can be entitled to make use of the 5th of June 2022 concessional date”.

The problem is exacerbated if a trustee has failed to lodge their annual return on time. For example, tax agents for SMSFs can usually lodge their 2021/22 annual return up to the 15th of May, 2023. But if your 2020/21 lodgment was late (with no extension), there is an earlier deadline for this return, the 31st of October 2022.

What are the consequences of late SMSF lodgment?

1.     Super fund compliance status changes

Late SMSF lodgment results in a change to the compliance status on the Super Fund lookup, which can result in the following ‘operational’ issues for the fund:

• The fund may be unable to accept rollovers from other complying superannuation funds
• The fund may be unable to accept certain contributions, such as employer contributions
• Some financial institutions, investment product or service providers may also not allow a new bank or investment account/investment product application until the ‘complying’ status is restored. Therefore, there may be negative investment implications for the fund.

2.     ATO-related implications for late lodgment

Failure to lodge on time puts the fund under more pressure, given an earlier lodgment deadline for the following year, e.g. the 31st of October. Having not met the May lodgment deadline, some funds find it increasingly difficult to meet a much shorter lodgment deadline.

If this deadline is not met, they’ll likely find they have a shorter deadline on an ongoing basis.

SMSF accounting and administration services

The message is clear: SMSF trustees must get a move on if they want to avoid trouble. However, it’s also clear that lodgment isn’t always as easy as it seems. This is why having a specialist SMSF accounting team to keep clients up-to-date and avoid the imposition of penalties can be invaluable.

 “By having a proactive, year-round service, we can identify and address issues as they arise, resulting in a far smoother audit and lodgment. It certainly takes away the stress, and our clients often comment on the peace of mind that this service provides,” says Mr Antoni.

Working in partnership

E&P SMSF accounting team can help individuals or work alongside external financial/investment advisers or accountants.

As SMSF specialists, we can help with the following:

• SMSF establishment
• Pension and contribution accounts maintenance
• Trust deed and establishment documentation compilation
• Annual audit coordination
• Annual financial statements and tax returns preparation
• All ATO reporting obligations, including TBAR PAYG and BAS completion
• Trust deed minutes and fulfilling ongoing SMSF compliance requirements preparation
• Using advanced software to ensure accuracy, efficiency and quality