Misuse of Early Super

ATO threatens fines and prosecution for misuse of early super access scheme

Members who took money out of their superannuation without meeting the eligibility requirements could face fines and prosecution, the Australian Taxation Office has warned. The Coalition’s early super access scheme allows eligible members to withdraw $10,000 in the last three months of this financial year and another $10,000 in the first three months of the next financial year.

The same dataset also showed 64 per cent of money withdrawn via the scheme was spent on discretionary goods – with gambling a close second to debt repayment.

“Instead of learning from the problems with the Robodebt scheme, they’ve just repeated them,” Shadow Assistant Treasurer Stephen Jones told The New Daily.

“They have set up a process with no manual oversight.”

Mr Jones has called for a full review of the system and urged the ATO to conduct spot checks and more rigorous data matching.

Treasurer Josh Frydenberg, however, has pushed back against suggestions the scheme is being abused, telling reporters on Monday that “this is their money and they will use that money for a range of purposes”.

“We are going through a once-in-a-century pandemic and people do need that extra funding, that extra financial support over and above other government initiatives to help them get through this period,” Mr Frydenberg said.

As with annual tax returns, the early super access scheme is based on self-assessment.

“This means that the information you provide to the ATO is initially accepted as being true and correct when you lodge your tax return and other forms on which you disclose,” an ATO spokesperson told The New Daily

“The self-assessment system places the onus on you to ensure your tax return, or in this case, an application for the early release of superannuation complies with taxation laws.” The ATO said it has “highly advanced data matching and audit systems in place” to check at a later date if people have purposely misled them.

This involves matching claims made in early release application forms against employer payroll data and other data sets to ensure people’s claims stack up.

“Where we have concerns that a claim is not made genuinely, we will work with individuals to understand how they assessed their eligibility,” the ATO spokesperson said.

“Where we have concerns that individuals have not made genuine applications, we may apply penalties. The penalties that apply vary based on the facts and circumstances of each case.

Your pdf copy: misuse-of-early-super-access-could-result-in-fines-or-prosecution-7-Jun-2020

Leave a Reply

Your email address will not be published. Required fields are marked *