The ATO has released a discussion paper on a currently known issue where an individual’s total superannuation balance (TSB) has duplicated accounts, leading to higher TSBs being displayed for the member.
In its discussion paper on duplicated accounts in the calculation of TSBs, the tax office said the error is occurring due to its systems being unable to match member contribution statements (MCS) and transfer balance account report (TBAR) forms. The TBAR and MSC forms for an account are currently matched using fund Australian business numbers and tax file numbers, member account numbers and member client identifiers. Where there is a failure to match, the system identifies these forms as being for separate accounts and counts a value from both forms, resulting in an overestimated member TSB, the tax office said. “We have identified 250,000 TBAR forms with a reported effective date of 30 June 2017 which have been unable to be matched to a corresponding MCS,” it said. “Changes to this matching process have been proposed, which will mitigate the need for re-reporting for an estimated 183,000 accounts.” The discussion paper identified seven scenarios that can result in an individual’s TSB having duplicated accounts, including funds that have reported the member client identifier on the MSC, but not on the corresponding TBAR, and the unique super identifier (USI) has been reported; and another scenario where the USI has not been supported. Other scenarios include a fund combining client identifiers on the TBAR form and failing to report the TBAR member client identifier, and funds reporting a new member account number on the TBAR. The discussion paper advised funds of the remediation required to correct their TSB calculation, stating that when identifiers on the TBAR are to be updated to allow for successful matching, the existing TBAR must be cancelled first by submitting an identical TBAR form with the exception that the label “TBAR cancellation” is reported as ‘Y’. A new TBAR must then be lodged in a separate file that includes the updated identifiers. The TBAR cancellation label must be reported as ‘N’. The ATO has called for feedback and participation in the discussion on its website, with the discussion to close on 4 May.
Following this date, funds affected will be contacted by ATO to discuss what action they may need to take.
Self Managed Super
26 April 2018