False or misleading statements which do not result in a shortfall amount
The ATO has published Practice Statement PS LA 2012/4, which details how they intend to administer the false or misleading no-shortfall penalty.
They advised Trustees who make a false or misleading statement after 4 June 2010 may be liable for penalties, even where the statement does not result in a shortfall amount. The penalty will not be applied if the trustees took reasonable care at the time they made the statement.
The statement must also be false or misleading in a ‘material particular’ for this penalty to apply. For example, a rollover benefits statement and a notice to claim a tax deduction form both contain material particulars.
SMSF trustees are ultimately responsibly for their fund; even if they use professional services such as administration providers, tax agents or other financial advisers.
The ATO has provided an example in the practice statement about a SMSF loan to members and where the new penalty may apply in relation to SMSFs.
The statement:
- can be written or verbal
- must be material to tax or super law
- can be for any taxes, including reporting, lodgment, debt and registration statements made by an entity.
For more information refer to:
- Superannuation and false or misleading statements which do not result in a shortfall amount
- Law Administration Practice Statement PS LA 2012/4
- Division 284 of Schedule 1 of the Taxation Administration Act 1953
- Miscellaneous Taxation Ruling MT 2008/2 Shortfall penalties: administrative penalty for taking a position that is not reasonably arguable.