Employer contributions cannot be received by self-managed super funds that have become invalid SMSFs due to failure to lodge their tax returns with the ATO. This highlights the importance of seeking assistance from SMSF accountants to ensure compliance with regulatory requirements.
This can significantly affect you as an employer when you try to contribute your quarterly superannuation contributions to the SMSF. In practical terms, it can affect the entire batch payment created to pay the quarterly contributions for all your employees. If the batch payment is reversed, it can take a few days for this to happen, and then you have to create another batch, which may mean you are late for the deadline.
To avoid being late paying super contributions, we would suggest that before processing a batch payment, you:
- Check the ABN status of SMSFs on the ATO Super Fund Lookup website.
- If their status shows “Regulation details removed”, they failed to lodge their tax returns, and payments cannot be made to that fund.
- Process all other employees (leave the self-managed super funds with issues out of this batch payment).
- Ask the employee(s) to either update their SMSF status with the ATO or provide you with alternative fund details.
- Run the individual transfer to the SMSF separately.
If you need assistance with the two-stage batch transfer, please do not hesitate to contact our bookkeeping team to explain. And if you have any questions, please contact us.
Kreston Stanley Williamson
*Correct as of October 2019
*Disclaimer – this article has been produced by Kreston Stanley Williamson as a service to its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas in this article, you must seek specific advice relating to your particular circumstances. Liability is limited by a scheme approved under professional standards legislation.
