Important SMSF Penalties
Contraventions that occur after 1st July 2014, including those which have occurred prior and not been resolved, will now be subject to a penalty. This penalty cannot be paid using the resources of the SMSF.
For individual trustees each trustee will be liable for a penalty. This means is you have a fund with two trustees you will be fined twice for the one offence, four trustees’ four fines. If a fund has a corporate trustee each director will be jointly and severable liable.
The fines can be quite significant – for example if you
- Lend money to a member of the fund;
- Fail to comply with the in-house asset rules; or
- Borrow money
the fine is $10,200.
It is important that trustees take care when internet banking as accidently transferring funds between the wrong accounts can result in the above contraventions. It may also be worthwhile considering setting up a corporate trustee for your SMSF.