Powered by MOMENTUM MEDIA
subscribe to our newsletter sign up

In your 30s and slack with your super? The ATO is watching

ATO

A growing pool of young Australian investors are making moves with their superannuation money that are raising red flags at the Tax Office.

Self-managed super funds (SMSFs) are being used as a vehicle to remove money from superannuation before preservation age, when it’s legally allowed to be released, according to the ATO.

This has always been a concern for the ATO, but new on its radar in 2019 is a growing numbers of investors who are in their 30s - and far off retiring - rolling their money out of a managed superannuation fund into an SMSF to get early access.

Those SMSFs often don’t lodge a return, so as not to alert the ATO to their transactions.

Advertisement
Advertisement

“Through our risk assessment processes, we have flagged this as an area where illegal early release could occur,” ATO assistant commissioner for the SMSF segment Dana Fleming told Nest Egg’s sister publication, SMSF Adviser.

The ATO has seen a steady increase in the population of SMSFs using this strategy over about a five-year time frame.

As reported yesterday, penalties can include, in extreme cases, funds being wound up and a 45 per cent tax impost being applied.

Other penalties include administrative penalties, which have a cost attached, or being disqualified from running a fund.

In your 30s and slack with your super? The ATO is watching
ATO
nestegg logo
subscribe to our newsletter sign up
FROM THE WEB
Recommended by Spike Native Network
Mort - The greatest fraudulent deception the ALP and Chris Bowen is running about Franking Credits is that "those who do not pay tax should not receive a.......
Dr Terry Dwyer, Dwye... - Become an age pensioner... a curious incentive for welfare dependency. Loss of $1 in part pension could cost someone thousands in franking credits........
Anonymous - I think they have this poor man confused with the government......surely.......fraud...steal money from taxpayers..!!.... hat fits perfectly !!....
Christopher O'Neill - The word "reform" is a lie. At best there is no agreement that this is any improvement at all. At worst it is a regressive tax policy that regresses.......