Retirement
Trustees cautioned on long-term disqualification consequences
One international law firm has warned of the lasting and potentially unexpected impact of trustee disqualification which could follow the involved individual “long after” they have left the SMSF sector.
Trustees cautioned on long-term disqualification consequences
One international law firm has warned of the lasting and potentially unexpected impact of trustee disqualification which could follow the involved individual “long after” they have left the SMSF sector.
Speaking to nestegg.com.au’s sister publication SMSF Adviser, Gadens partner Kathleen Conroy noted that in the 12-month period ending 30 June 2015, the ATO disqualified 663 individuals.
This is an increase of approximately 13 per cent from the preceding 12-month period, when 585 individuals were disqualified, and more than double the number disqualified in the 2010-11 year, when that number stood at 330 individuals.
“Disqualification is an attractive option for the ATO. For obvious reasons and for reasons not immediately apparent to those who have not been caught in the disqualification net, it is not so good for the disqualified individual,” Ms Conroy said.
Disqualification will operate for an indefinite period, she noted, putting the onus on the disqualified individual to instigate the necessary steps should they wish to have the disqualification revoked.
“This can be a time consuming, emotionally draining and expensive process,” Ms Conroy said.
Following a decision to disqualify, the ATO issues a notice to the individual, stating their name and including a statement to the effect that, in the view of the ATO, the law has been contravened and this will be published in the Government Notices Gazette.
“The Gazette is published electronically and can be easily accessed by an internet search,” Ms Conroy said.
“Put another way, if you are disqualified an online search against your name will – in the usual course – reveal to the world at large (including employers, colleagues, clients, family and friends) your disqualified and ‘law breaker’ status,” she said.
“A disqualification may be revoked in certain circumstances. A revocation will also be published. However, there is no obligation on the ATO to remove the original disqualification decision from the world wide web.”
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