BDO Quarterly Super Update | June 2024

BDO’s Super Quarterly Update | June 2024

Welcome to our final edition of BDO’s Superannuation Quarterly Update for the 2023/24 financial year, where we provide the latest news and insights from the ever-changing superannuation and self-managed superannuation fund (SMSF) landscape in Australia. Keeping up to date with the latest developments and requirements is crucial to fulfilling your obligations and optimising your superannuation benefits.

In this update, we will cover important announcements from the Australian Taxation Office (ATO), contribution caps, upcoming lodgement dates, our FY25 Superannuation Fact Sheet, and a Q&A with BDO Partner and Superannuation lead, Paul Rafton.

What is the Regulator saying?

Get your paperwork in place if you want to claim a deduction for your superannuation contributions

The ATO have reminded SMSF members that if they want to claim a deduction for any personal super contributions, they must complete a ‘Notice of intent to claim or vary a deduction for personal super contributions (NAT 71121).’

Once this has been received from the member, the trustee of the fund must provide written acknowledgment confirming receipt of a valid notice of intent to claim a deduction. Members require this acknowledgment from their fund in order to include the deduction in their tax return.

SMSF members who plan to roll over or withdraw their super should ensure they have obtained the acknowledgment for their deduction before proceeding with any rollover or closure of their account. If a member submits their notice of intent after transferring their super balance to another fund (i.e., closing their account) or withdrawing their super as a lump sum, the notice will not be considered valid. Consequently, the member will be unable to claim a deduction for contributions made prior to the rollover or withdrawal.

You can find more information on the eligibility to claim personal super contributions as a tax deduction on the ATO website, or from your BDO adviser.

Notify the ATO if you make any changes to your SMSF

As a trustee, you are obligated to inform the ATO promptly about any changes to your self-managed super fund (SMSF). These changes may involve:

Contact details
Bank account details
Structural changes to the fund, e.g. a change of trustee.

Regardless of how big or small these changes are, it is important to notify the ATO within 28 days. Your BDO adviser is able to assist with updating any relevant details and advising the ATO promptly. Contact us today for tailored support.

The removal of hyperlinks from all ATO SMS messages

It is well known now that the use of SMS for cybercriminal activities has significantly risen, with SMS scams impersonating the ATO increasing by over 400 per cent during the 2022–23 financial year. These scams often use hyperlinks to direct individuals to sophisticated fraudulent websites, such as fake MyGov login pages, to steal personal information or distribute malware.

In January, the ATO announced they were in the process of removing all hyperlinks from their SMS text messages, to be completed by July 2024. This measure aims to prevent scams that utilise malicious links, thereby enhancing community protection and fostering trust and confidence in the ATO's tax, superannuation, and registry systems.

The ATO have reiterated that they will never send links to login pages in text messages, and they remind SMSF trustees that the most secure way to access services (such as MyGov) is by typing the relevant address into their web browser.

We ask that you contact us if you receive a message from the ATO and have concerns that it is not genuine.

Contribution caps

Did you know that the contribution caps are increasing again on 1 July 2024? From 1 July 2024, the contribution cap increase as follows:

Annual cap	1 July 2021 to 30 June 2024	From 1 July 2024
Concessional contributions	$27,500	$30,000
Non-concessional contributions	$110,000	$120,000

This increase allows a greater opportunity for individuals to contribute towards securing their financial future, whether through salary sacrifice, personal deductible contributions, or non-concessional contributions.

It’s important to remember that not everyone meets the criteria to make contributions, and it can be a costly mistake if you make contributions that you are not entitled to make. If you are making contributions, contact your BDO adviser for assistance and tailored advice.

Did You Know?

Super Fund Lookup

Did you know that the Australian Government has a website that contains publicly available information about all self-managed superannuation funds? This website is called Super Fund Lookup, and it can be accessed online here.

Super Fund Lookup is the ATO’s external register of SMSFs and their current compliance status. Not all funds are complying funds at all times, and there are a number of different statuses that the ATO uses to classify SMSFs. This website allows you to look up your fund and check its current status, which can be useful when your employer is making contributions, or if you are planning to rollover money over into your SMSF from an industry or retail fund.

SMSFs are classified with a number of status types, including:

1. Registered

A registered SMSF is eligible to receive rollovers and contributions but has not yet received a notice of compliance. When this is issued, the ATO will change the status of the fund to ‘complying’.

Most funds with this status are newly registered funds, and it can take a newly registered fund up to 56 days to appear on Super Fund Lookup while the ATO perform a number of checks. New funds undergoing these checks may also show on the register as ‘Election to be Regulated is being processed’.

2. Complying

A fund with a ‘complying’ status has received their notice of compliance from the ATO. A complying fund is eligible to receive the concessional tax rate of 15 per cent and is eligible to receive employer contributions and rollovers from other funds.

3. Non-complying

A non-complying fund is either a non-Australian resident fund or one that has been issued with a notice of non-compliance due to significant compliance breaches. These funds pay 45 per cent tax and cannot receive contributions or rollovers.

4. Regulation details withheld

The ATO have stated that there are a number of reasons why an SMSF may have their regulation details withheld. This usually occurs when they have concerns about how an SMSF is operating and must conduct further enquiries into its operation. Generally, rollovers cannot be paid into these SMSFs, and the ATO recommends that employers do not make contributions into the fund, as it is not clear if the fund is complying.

5. Regulation details removed

If an SMSF has an annual return that is more than two weeks overdue, the ATO applies a status called ‘Regulation details removed’. This status causes a lot of problems for trustees, as contributions and rollovers cannot be paid into a fund that has their details removed. The solution is to get all overdue returns lodged, and the ATO will restore the fund’s ‘Complying’ status. It’s important to note that the updates to the SMSF status are usually made on the first day of the month, so if you miss this deadline, you will need to wait another four weeks before it is updated.

If you would like to confirm the current status of your SMSF, visit superfundlookup.gov.au, and contact your BDO adviser if you have any questions.

BDO FY25 Super Fact Sheet

BDO’s Superannuation Fact Sheet is designed to help you better understand your SMSF. Access the fact sheet now for key dates, reminders, and important updates for SMSFs in the 2024/25 financial year.

DOWNLOAD THE FY25 SUPER FACT SHEET

Q & A

Paul Rafton, Partner and National Leader for Superannuation, has been with BDO’s Brisbane office for over 15 years. This month, Paul went from interviewer to interviewee when he sat down with Lisa Philip, BDO’s National Superannuation Manager, for a Q&A session.

Paul, you’ve been in the SMSF industry for almost your whole career– do you remember what inspired you to become an SMSF specialist?

I started working in the SMSF sector about 30 years ago, around the time the Superannuation Industry (Supervision) Act and Regulations were introduced.

The notion that individuals could establish and run their own superannuation fund was appealing to me.

The rules and the various caps are constantly changing, which means that advisers and SMSF trustees need to keep up to date with their knowledge.

Superannuation is a long-term asset and for many people, outside of their principal residence, their super will be one of their largest assets.

Are there any particular trends in the SMSF industry that you think trustees should be aware of?

The SMSF industry is constantly evolving and changing, there are several trends that I think SMSF trustees should keep in mind when managing their superannuation:

Regulatory changes – Keep an eye on any regulatory changes or updates from the Australian Taxation Office (ATO) and other relevant authorities. Changes in superannuation rules and regulations are constantly occurring and can affect investment options, contribution limits, and compliance requirements.
Technology Integration – Technology is increasingly being integrated into SMSF administration and management processes. Trustees should be open to exploring digital platforms and tools offered by their accountant or administrator as these can streamline administrative tasks, provide real-time insights into fund performance, and enhance communication with advisers. For example, BDO is in the process of launching our new client portal, which will provide a secure mechanism for clients and BDO to securely send and receive documents to each other.
Cyber security – I think this is the biggest trend that everyone should be aware of, not just SMSF trustees. With the increasing use of technology in SMSF management, cyber security is a significant concern. Trustees should implement robust cyber security measures to protect sensitive financial information and guard against cyber threats, including some common-sense measures – always use strong passwords, enable multi-factor authentication when you have the option and always confirm bank details before sending money online. Remember to remain sceptical when responding to requests for personal information.

What is your advice for clients who are establishing an SMSF and becoming trustees for the first time?

I believe the first thing that new SMSF trustees need to do is to understand their responsibilities as a trustee. Before establishing a new SMSF, individuals should ensure they receive appropriate advice and that an SMSF is right for them. There are a number of compliance requirements when it comes to managing your own superannuation (for good reason), so take the time to familiarise yourself with these. The ATO has some good resources to help you understand these, and your BDO adviser will always be willing to assist you. A qualified specialist adviser will provide valuable insights and assistance throughout the whole establishment process and will be an essential resource when an SMSF up and running.

Superannuation key lodgement dates

Deadline	Description
Payment of super guarantee contributions.	28 days after each quarter ends e.g. SG contributions for the June 2023 quarter must be paid by 28 July 2023.
Lodgement of tax returns for newly established SMSFs.	28 February 2024 (payment is also due on this date).
Lodgement of tax returns for SMSFs with income in excess of $2 million in the last income year lodged.	31 March 2024 (payment is also due on this date).
Lodgement of all other SMSFs.	15 May 2024 (payment is also due on this date).
Transfer Balance Account Reports (TBAR).	All SMSF’s are now required to lodge TBARs on a quarterly basis, regardless of the member’s Total Super Balance (see above).

DISCLAIMER:

The information contained in this publication is purely factual in nature and does not take into account your personal objectives, financial situation or needs. It is provided as an information service only and does not constitute financial product or other professional advice and should not be relied upon as such. Before making any investment or financial decisions you should consider your particular objectives, and financial circumstance or needs. Where information relates to a particular financial product you should obtain and consider the relevant Product Disclosure Statement and obtain advice from a financial adviser before making any decision. If you do require financial advice, please contact the relevant BDO member firms in Australia who will be able to assist you in their capacity as an Australian Financial Services licensee. BDO Australia Ltd and each BDO member firm in Australia, their partners and/or directors, employees and agents do not give any warranty as to the accuracy, reliability or completeness of information contained in this publication nor do they accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this publication or for any decision based on it, except in so far as any liability under statute cannot be excluded.

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