In this guide
Record number of financial complaints in 2023
The Australian Financial Complaints Authority (AFCA) has reported a record number of complaints of over 100,000 in calendar year 2023, an increase of 23% on 2022.
“The volume of complaints escalated to AFCA has been increasing at an unsustainable rate,” AFCA chief ombudsman and chief executive officer, David Locke said.
Of great concern to AFCA is the almost doubling in scam-related complaints between 2022 and 2023.
AFCA registered 8,987 complaints related to scams, an increase of 95% from 2022. Complaints involving financial hardship rose 29% to 5,396.
“We are also seeing the impact of increased interest rates and cost of living pressures, with complaints involving financial hardship also significantly higher,” Locke said.
The most complained about product in 2023 was personal transaction accounts, while the most complained about issue was unauthorised transactions.
Penalty units set to rise again
In the Mid-Year Economic and Fiscal Outlook 2023–24 (MYEFO) the government announced it plans to increase the amount of the Commonwealth penalty unit by 5.4% from $313 to $330. That follows an increase from $275 to $313 on 1 July 2023 and represents a 83% increase since 2017.
As a result of this latest increase, SMSFs need to be aware that most administrative penalties will increase from $16,500 (60 penalty units x $275) to $19,800 (60 penalty units x $330).
The increase would mean failure to prepare your SMSFs financial accounts and statements could incur an administrative penalty of 10 penalty units, at a cost of $3,300.
Under superannuation law, the Australian Taxation Office (ATO) can apply penalties for reasons including:
- lending to members or relatives (with exceptions): 60 penalty units
- borrowing (with exceptions): 60 penalty units
- failing to comply with in-house asset rules: 60 penalty units
- failing to keep minutes: 10 penalty units
- failing to keep records of changes of trustee: 10 penalty units
The MYEFO said the increase would commence four weeks after passage of the relevant legislation.
Read our article on penalties for non-compliance here for more information.
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