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SMSF trustee alert – legislation passes to increase financial penalties
Article published on: 29-11-2022
Legislation increasing the value of penalty units from $222 to $275 from 1 January 2023 has passed. This means that the potential financial penalties imposed as a result of breaching certain tax and super laws will increase.
The value of penalty units will be indexed every three years to the Consumer Price Index (CPI).
The table below outlines a range of penalties that may apply for non-compliance with legislation impacting each SMSF trustee. It is important to note that penalty amounts cannot be paid from fund assets and are imposed on each trustee, meaning that funds with individual trustees could have a greater overall penalty applied compared to a fund with a corporate trustee.
SIS Section
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Rule
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Penalty units
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Current maximum penalty
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Maximum penalty amount from 1 January 2023
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s34
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Breach of an operating standard
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20
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$4,440
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$5,500
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s65
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Prohibition on lending to members and relatives
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60
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$13,320
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$16,500
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s67
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Prohibition on borrowing
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60
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$13,320
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$16,500
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s84
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In-house assets
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60
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$13,320
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$16,500
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s103 & s104
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Failure to keep trustee minutes and change of trustee details for 10 years
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10
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$2,220
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$2,750
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s160
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Failure to comply with ATO education directive
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5
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$1,110
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$1,375
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Refer to the ATO guidelines for further details on the penalties for SMSF non-compliance.
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