Every Three Year SMSF Audits – A Ludicrous About Face

As a Tax Advisor to small businesses that run Self-Managed Super Funds (SMSFs), I am aghast at the way our federal government and, in particular, Canberra bureaucrats treat this sector. For many years the Industry Funds and Funds Management sectors of Superannuation have lobbied the government to “straighten out” SMSFs. The main reason is that SMSFs are a threat to these sectors and so the witch-hunt has been on to weed out “all the baddies” and put enormous amounts of red tape around SMSF Auditors.

SMSF Auditors now must: be registered with ASIC; be registered with the ATO; have enormous amounts of regular professional updates; and also be audited by their peak professional bodies, such as the Chartered Accountants ANZ and CPA Australia.

The red tape and scrutiny is way over the top when almost all SMSFs are doing the right thing.

Recently, after wrapping this area of small business in a ridiculous amount of red tape, the Treasury came out in the Budget and suggested that these SMSF audits should happen every three years rather than every year.

Do they have nothing to do up there?

I can’t believe it. Let’s make these people answerable to everyone – we can then put them out of business by leaving their skills on the shelf two out of every three years.

This is bureaucracy and lobbyists gone mad and the loser is small business. Many of our clients have commercial property in their SMSF that their own business runs out of and there is a commercial lease in place. They have a few more blue chip assets such as shares and that is it. It’s a perfect way to run their small business and save for retirement.

These are the people that lose out because SMSFs are a political football.

Just let them be and small business people will be encouraged to self-fund for their own retirement in a legitimate way. They should only be audited every year to make sure the complex rules are followed.

Pat Mannix, Partner, Paris Financial