Awan Hammad

    Hi Lacey

    Yes in relation to newly established SMSF’s the ATO advises in their Auditor Contravention Report criteria that:

    “As at the end of the financial year, if the SMSF is less than 15 months old and there are contraventions, you need to identify if any single contravention has exceeded $2,000. If this is the case, you report all contraventions of the sections and regulations listed in tables 1A and 1B, regardless of the financial thresholds. You apply no further tests.”

    If division 293 tax has been paid without the authority to release you have a breach of:

    Section 65 – “The trustees must not loan monies or provide financial assistance to any member or relative

    at any time during the financial year”.

    Reg 5.08 – “Member minimum benefits must be maintained in the fund until transferred, rolled over,

    allotted (to the member’s spouse) or cashed out in a permitted fashion”.

    Reg 6.17 – “Payments of member benefits must be made in accordance with Part 6 or Part 7A of the

    regulations and be permitted by the trust deed”.

    As the breaches meet the new fund test you would be required to lodge an Auditor Contravention Report.

    Yes, in relation to the division 293 tax that has been paid and an authority to release has not been received this should be repaid by the member. Given the relatively low amount owing my view is that it is not necessary to calculate an interest amount owing.


    The Auditors Institute


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