For example, relief is available in relation to the residency status of SMSFs where the member is stranded overseas due to COVID-19 and where this could potentially cause the fund to fail the definition of an Australian superannuation fund. The Australian Taxation Office (ATO) won’t devote compliance resources to determine whether the fund meets the residency test in cases like this.
If rental relief has been provided by a SMSF or non-geared unit trust to a related party, then the ATO will not take compliance action against the fund provided the relief is provided on commercial terms due to the financial impacts of COVID-19 and the fund has properly documented the arrangement.
The ATO won’t take compliance action against a fund if it has provided loan repayment relief to a related party due to the financial impacts of COVID-19, provided the relief is provided on commercial terms and any changes to the loan are properly documented.
Also, the ATO is taking a more lenient approach in situations where a fund has breached the 5% in-house asset limit on 30 June 2021 due to the financial impacts of COVID-19 and is unable to reduce the market value of its in-house assets to below 5% by 30 June 2022. The ATO still expects that a written plan is put in place regarding this but won’t take compliance action against the fund if the plan cannot be executed by 30 June 2022 because of the financial impacts of COVID-19.
CHANGES TO HOW SMSF ROLLOVERS ARE MANAGED
From 1 October 2021, certain SMSFs expecting or receiving a rollover will need to ensure that they are SuperStream Rollover v3 compliant. Certain release authorities will also be sent to the fund via this method.
These new rules will affect SMSFs receiving rollovers or rolling out member benefits to another fund. The SMSF will also receive release authorities for excess concessional and non-concessional contributions, Division 293 release deferred and non-deferred amounts and releases under the First Home Super Saver (FHSS) Scheme.
In order to be ready for the changes the fund trustee or tax agent should ensure that their Electronic Service Address (ESA) provider is or will be SuperStream Rollover v3 enabled from 1 October 2021.