SMSF Trustees find ATO Refreshingly Helpful
According to Andrew Frith of the Self-Managed Super Specialists, headquartered in Newcastle NSW, it was refreshing to hear the Commissioner of Taxation, Michael D'Ascenzo, in his speech to the SMSF Professionals Association of Australia (SPAA) in February 2011, say that the ATO's "consistent message both to our people and to the community is to take care of family, friends, community and property first. We can sort out tax and super issues later."
This was said following the devastating floods in Queensland, Victoria and Western Australia. We have recently added the Illawarra and South Coast of NSW to this list.
One of the specific ways the Commissioner indicated assistance to self-managed super funds is where the fund may have acquired what are now flood or cyclone damaged buildings, in which case the ATO, in determining what is a repair or an improvement, whilst not having "a discretion to treat what is an improvement to be repaired, or a repair to be an improvement", they "will not be seeking to make fine distinctions having regard to what is available to repair what has been damaged".
The Commissioner went on to say "In financing repairs or incurring other costs, SMSF trustees may need to borrow funds and if SMSF trustees contravene the limited recourse borrowing provisions due to the natural disasters experienced Australia-wide, we would be favourably inclined to exercise the Commissioner's Discretion under section 42A(5) of the Superannuation Industry (Supervision) Act 1993 (SISA) to continue to treat the super fund as complying.
Mr D'Ascenzo added "We are currently reviewing this matter with APRA and Treasury to ensure no unintended consequences arise."
Andrew Frith commented further how important it is for the taxpayer to know that there is human thought and a caring attitude behind the enormous bureaucracy that is the ATO.
Andrew Frith is the Chief Executive Officer of Leenane Templeton The Self Managed Super Specialists Pty Ltd. Located in Newcastle, NSW, Australia. Visit Self Managed Super Funds web site for further information or visit our Newcastle Financial Planning Self Managed Super Fund Page.
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