The Assistant ATO Commissioner responsible for the SMSF segment, Dana Fleming, was involved in  a robust exchange with an attendee at the SMSF Summit yesterday. The attendee’s octogenarian client had rolled a pension from an SMSF into an APRA fund and, due to the TBAR timing mismatch, had received a TBA breach notice which caused the client inordinate stress. Can the ATO do anything to alleviate this? Unfortunately, no!

Consider a $900k pension rolled from an SMSF into an APRA fund in July 2019. If the fund was not a quarterly TBAR lodger, the ATO would not receive the TBAR until as late as May 2021. That’s nearly 2 years later. Even a quarterly lodger would be delayed around 4 months. The different reporting time frames were a concession to the SMSF sector. APRA funds report immediately. No one in the SMSF sector would seriously wish the reporting concession to be removed and it is impossible for the ATO to delay the issuance of the breach notice on the basis that there might be a compensatory TBAR lodged into the future.

We lodge TBARs on a monthly basis but even this isn’t adequate, so we now adopt the only practical solution. A TBAR must be lodged immediately a pension rollover from an SMSF to an APRA fund is processed – no exceptions.