The first quarter of 2019 has ended and with it may come new Transfer Balance Account Report (TBAR) reporting requirements for your SMSF clients.
Hopefully, by now, you have attended to lodging a TBAR to report details of retirement phase pensions that your SMSFs were paying on 1 July 2017 (commenced prior). This report was due on 1 July 2018.
The next question:
Ongoing, is your SMSF a quarterly or annual TBAR reporter?
Quarterly TBAR Reporter
A SMSF will be a quarterly reporter if at least one member had a Total Superannuation Balance (TSB) of $1M or more at a particular test time, even if that member is not in retirement phase.
The test time is the later of:
- 30 June 2017, if a member had a pre-existing pension or commenced a pension during the 2018 year.
- 30 June of the income year before the first member of the SMSF commences a pension.
The Fund cannot switch between reporting frequencies once this has been established, even if members’ TSBs fall below $1M.
So you’re Quarterly…. What do you need to do?
By 28 October 2018 you need to lodge a TBAR to report all reportable events that have occurred between 1 July 2017 and 30 September 2018.
What are reportable events?
- Commencement of retirement phase pension
- A TRIS becomes an Exempt TRIS
- Full or partial commutations of a retirement phase pension
- Certain LRBA loan repayments that result in value shifting between accumulation and pension interests
- Ceasing of an income stream
- Compliance with a commutation authority
- A structured settlement contribution.
Importantly, retirement phase pension payments do not need to be reported.
Annual TBAR Reporter
If the SMSF is lucky enough to be an annual reporter, the deadline is the due date of the SMSF’s annual return.
Practically this will place additional burdens on accountants and will lead to the need for real time reporting for at least their quarterly reporting SMSFs.
Questions? Please contact Joel if you have any queries on the TBAR reporting requirements – as always, we are here to help.