In November 2017 the ATO launched project Super Scheme Smart to educate taxpayers and advisors about tax schemes involving SMSFs.

“Each year we discover complex tax schemes and arrangements designed by promoters solely for the purpose of helping people avoid tax,” says the ATO.

The ATO says it is currently seeing a number of schemes targeting Australians planning for retirement, with these people being encouraged to “inappropriately” channel money through SMSFs.

“The penalties are substantial for those involved in deliberate tax avoidance schemes,” said the ATO.   

“And the penalties aren’t just financial; an individual may well lose their right to be a trustee of their own superannuation fund; or in some cases they could go to jail. Promoters of these schemes are also on our watch list.”

These schemes have some common features, they:

• are artificially contrived with complex structures usually connecting with an existing or newly created SMSF

• involve a significant amount of paper shuffling

• are designed to give the taxpayer minimal or zero tax, or even a tax refund

• aim to give a present-day tax benefit by adopting the arrangement.

I will provide more information on these schemes in the next few updates; however, a tell-tale sign of these schemes is that they will invariably sound ‘too good to be true’, and as such they generally are.

Source: https://www.ato.gov.au/General/Tax-planning/Tax-avoidance-schemes/Super-Scheme-Smart/