The SMSF Professionals’ Association of Australia (SPAA) welcomes the decision reached between the US and Australian governments to exclude self-managed super funds and superannuation from the United States’ Foreign Account Tax Compliance Act (FATCA).
In an agreement announced by the Treasurer, Joe Hockey, Australia and the US have signed an intergovernmental agreement that cuts the burden on Australian financial institutions in complying with FATCA. It takes effect on 1 July 2014.
For all Australian superannuation funds, it effectively removes them from the FATCA reporting regime.
SPAA CEO Andrea Slattery says: “This decision is an excellent outcome for all Australian superannuation funds and for SMSFs in particular.
“SPAA made strong representations to the Australian and US Treasury departments to exclude SMSFs from FATCA for the simple reason Australian superannuation funds pose a low risk of tax evasion because they are subject to strict regulation and supervision in Australia, whether it is by APRA or the ATO.
“This means that any SMSFs that have a US citizen as a trustee or member don’t have to adhere to the strict FATCA reporting compliance, saving considerably on costs for trustees and their advisors.
Mrs Slattery says SPAA acknowledges the important and key role played by the Financial Services Council in spearheading the industry’s advocacy on this issue.
“We also congratulate the Treasurer and the Federal Treasury on their work on negotiating this intergovernmental agreement that has produced such a good outcome for our SMSF sector and the Australian superannuation system,” she says.
The SMSF Professionals’ Association of Australia (SPAA) is the authoritative voice for the self-managed superannuation fund (SMSF) sector. SPAA, which represents professionals providing a range of services across various disciplines in the complex area of SMSFs, is an advocate for the highest professional standards and competence to ensure SMSF trustees always receive the best possible advice.