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We have a situation where the SMSF we are busy preparing for June 2023 is 100% in pension Phase for both the 2 members. The Trustees are adamant that they processed their pension payment for June 2023 on 30th June 2023 which was a Friday but the transfer out to their personal account only showed up on Monday (3rd July) on the SMSf bank account. The members are happy to sign a stat declaration to the effect that the payment was processed on Friday 30Th as they have no other proof of showing this. Are we able to show this payment as a pension payment and record this as an Outstanding cheque at 30/6/2023 and still treat the SMSF as 100% in pension.
Would that satisfy your audit requirement or is their anything else you would require to satisfy your audit requirements so the fund can remain in pension phase for June 2023.
Hi Nayan,
I feel that an independent person reviewing the circumstances you outline would conclude, on the balance of probabilities, that the trustees did not make the payment on 30 June 2023. In other words, they forgot to make the payment on the Friday and attempted to fix the problem at some time over the next three days, knowing the consequence otherwise would be loss of ECPI for the pension account(s).
If the trustees did attempt to make the payment on 30 June, they would logically have looked for the resulting debit to the SMSF bank account to confirm payment and, identifying that it was not there, would have secured further evidence of their efforts to make the payment, contacted the bank, etc etc.
Any statutory declarations produced by the trustees would be self-serving and of little weight.
The trustees are not the first to have made this expensive error.
Rob Bennett