Oops! Top 10 SMSF boo-boos for 2014 financial year

Note: Every year, the ATO publishes the top compliance mistakes made by SMSF trustees. This article contains data up to 30 June 2014 (latest available as at February 2015). The next update, for compliance data up to 30 June 2015, will be available in late 2015.

The ATO has published the top 10 compliance mistakes that SMSF trustees make when running their self-managed super funds. The list below is based on the general type of contraventions reported by SMSF auditors since the start of contravention reporting in 2005 (and up to 30 June 2014).

An interesting observation to make from the top 10 compliance mistakes is that 3 types of contraventions represent more than two-thirds (69.2%) of the value of assets involved in the top 10 contraventions, namely:

  • In-house assets
  • Separation of assets
  • Loans to members/financial assistance

While just under two-thirds (64%) of all contraventions, when looking at number of breaches, involve only 4 types of contraventions, namely:

  • Loans to members/financial assistance
  • In-house assets
  • Separation of assets
  • Administrative-type contraventions
Types of contraventions reported to the ATO (up to 30 June 2014)
Contravention types Number (%) Value (%)
Loan to member/financial assistance 21.5% 15.0%
In-house assets 19.0% 28.8%
Administrative-type contraventions 10.8% 1.6%
Separation of assets 12.7% 25.4%
Operating standard-type contraventions 8.0% 6.1%
Borrowings 7.8% 7.4%
Sole purpose 8.0% 4.9%
Investment at arms length 7.7% 7.5%
Other 3.1% 1.0%
Acquisition of assets from related parties 1.4% 2.4%
Total 100% 100%

Note: The column titled ‘number %’ means the percentage of contravention reports that involved this particular type of breach, while the column titled ‘value %’ relates to the value of assets involved in this particular type of breach.

Source: Self-managed superannuation funds: A statistical overview 2012-2013

For an explanation of the rules mentioned in the top 10 list above, you can refer to the ATO website, or to Trish Power’s book DIY Super For Dummies, 3rd Australian edition (Wiley, $39.95).You can find more details about this book by clicking here.

IMPORTANT: SuperGuide does not provide financial advice. SuperGuide does not answer all questions posted in the comments section. SuperGuide may use your question or comment, or use questions from several readers, as the basis for an article topic that we publish on the SuperGuide website. We will not disclose names or personal information in these articles. Comments provided by readers that may include information relating to tax, superannuation or other rules cannot be relied upon as advice. SuperGuide does not verify the information provided within comments from readers. Readers need to seek independent advice about their personal circumstances.


  1. Daniel Hung says:

    Can a SMSF buy an old LMR house site ( with no borrowing ) and build four town houses on it and sell it for profit?

  2. What are the best investments for a SMSF to invest to avert becoming an ATO statistic?

  3. Steve Foulds says:

    Quick Q – Can a SMSF pay for financial advice? For example, if I was to see a financial planner for advice on how to allocate my SMSF funds best, could I use the funds from the SMSF to pay for it or would I have to pay for it from own pocket?

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