SMSFs: The importance of lodging tax returns on time

With the Australian Taxation Office (ATO) continuously cracking down on non-compliant superannuation funds, it is imperative that your SMSF lodges its annual tax return on time each year.

If you lodge through a tax agent, you typically have a due date of May 15 of the following year regarding the annual tax return for a self-managed super fund (SMSF).

The due dates for lodgement and payment for an SMSF can vary and can depend on factors such as whether:

• The fund is newly registered
• A tax agent has been engaged
• The fund has prior year lodgements outstanding.

Responsibilities of trustees

Trustees of an SMSF ultimately have the responsibility to ensure the superannuation fund’s annual tax returns are lodged by the due date.

With the help of tax agents and SMSF specialists, the burden and stress of annual compliance can be reduced and allow trustees to focus on other areas such as their SMSF investment strategy and retirement planning.

By engaging a tax agent, the due date for the annual tax return is extended to May 15 each year (other than the first year).

The tax agent can also assist with the accounting, record keeping and preparation of the financial statements, as well as the resolutions and minutes required each year to get through an audit and allow the fund to lodge its annual tax return on time.

Requirement for annual independent audit

Trustees can encounter issues lodging on time when an auditor has not been appointed.

An independent and approved auditor is required to assess the fund’s overall compliance each year with superannuation legislation.

The auditor is required to complete their audit and issue an audit report for each year. The annual tax return is unable to be lodged until an audit has been finalised and an audit report has been issued.

It’s important that trustees consider the time required for an audit to make sure the annual tax return can be lodged by the due date.

Risks and ramifications of late or non-lodgement of annual SMSF tax return

If a superannuation fund does not lodge its annual tax return by the due date, penalties can be high.

The SMSF risks late lodgement penalties, general interest charges, and its regulation details being removed from the Super Fund Lookup (SFLU) if an annual return is submitted more than two weeks past the due date.

If the fund has had its ‘regulation details removed’ then the SMSF will be unable to roll member benefits in from a different superannuation fund or receive employer superannuation guarantee (SG) contributions until the outstanding annual tax return has been lodged.

Do you have questions about your superannuation?

Superannuation can be complex to navigate, and rules are changing frequently.

At LDB Group we can assist trustees to get their outstanding annual tax returns lodged and up to date and get the SMSF’s regulated status returned.

If you have any questions about how late or non-lodgements can affect you, please contact LDB’s superannuation specialists by phoning (03) 9875 2900 or filling out the contact form below.