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Integrity, Innovation & Commitment


  • Tuesday, 25 June 2024 03:19


The Australian Taxation office (ATO) has made a call to professional accountants to help identify and manage illegal early access to superannuation by members of self-managed superannuation funds (SMSFs).

In general, access to your super is only possible if:

  • You retire and turn 60; or
  • You turn 65 (regardless of whether you’re working).

Early access to superannuation is only possible in very limited circumstances such as terminal illness, permanent incapacity, and severe financial hardship and there are very strict protocols to follow before any amounts are paid out.

One of the benefits of an SMSF is the control that it provides to members. The flip side of full control is the temptation to dip into the super account and approve transfers without proper controls.

There are two common ways illegal early access occurs:

  • When the trustees (or their business) are in financial distress, and they use the superannuation account for a short-term loan; or
  • A promoter offers access through a scheme – often getting people to establish the SMSF and roll over their superannuation into the SMSF.

Illegal access to the SMSF’s account or assets is not difficult to identify and generally will be picked up by your auditor. Where illegal access has occurred, not only is it likely that your retirement savings have been lost or impaired, but you are likely to face additional tax, penalties, and interest, and be disqualified as a trustee. In addition, your name will be published online.

One of the signs that there is a problem is when SMSF annual returns are not lodged on time or at all so ensure you are up to date with your SMSF compliance.


SMSF members must have written acknowledgment of notice of intent prior to claiming a deduction for contributions.

To claim a tax deduction for personal super contributions SMSF members must complete a Notice of intent to claim or vary a deduction for personal super contributions.

Once received, a fund trustee must send a written acknowledgment, confirming they have received a valid notice of intent to claim a deduction. Members must receive the acknowledgment from their fund before they can claim the deduction on their tax return.

SMSF members considering rolling over or withdrawing their super should ensure they have an acknowledged notice of intent for any deduction before they initiate a rollover or close their account.

If a member gives their fund a notice of intent after they have rolled over their super interest to another fund (that is, closed their account) or withdrawn their super interest (paid it out of super as a lump sum), the notice won't be valid. This means the member will not be able to claim a deduction for the contributions they made before the rollover or withdrawal.

You can find more information on the eligibility to claim personal super contribution deductions and the valid notice of intent on the ATO website.






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