From 1 July this year, the Australian Taxation Office has new powers to fine and punish SMSF trustees when they breach certain provisions of the legislation.
The financial penalties
There are 17 possible breaches that will incur financial penalties from $850 up to $10,200, depending on the breach. The new system has been in the pipeline for a while, but legislation passed in March has made it official. It will operate as a penalty unit approach, under which each penalty unit will carry a fine of $170.
The new penalties start at five penalty units, or $850, for something like not providing appropriate statistical information to the ATO. That penalty rate would then double for not preparing financial accounts and statements or keeping appropriate records of meetings and important decisions.