Australian Taxation Office to crackdown on superannuation scam

Tax authorities will launch a crackdown on dodgy accountants duping workers into accessing their retirement savings early after a special taskforce found evidence ethnic and sporting groups were being targeted, particularly in Sydney’s west.

The ATO is cracking down on accountants who allow clients to dip into their superannuation early.

TAX authorities will launch a crackdown on dodgy accountants duping workers into accessing their retirement savings early after a special taskforce found evidence ethnic and sporting groups were being targeted, particularly in Sydney’s west.

The Australian Taxation Office is understood to have at least six investigations under way, with the possibility of referring the rogue agents for prosecution within months, after the scam was first detected in January.

The investigations come as the Turnbull government is preparing this week to pass new laws protecting the retirement savings from major superannuation companies, which charge high fees on accounts which have next to no money in them, depleting them entirely.

Deputy tax commissioner James O’Halloran warns the dodgy schemes can cost people thousands in fines and fees.

The scam involves setting up fake self-managed super funds and withdrawing cash to pay down debts, buy cars or even take holidays, with the promoters of the scheme usually dipping into the retirement savings of their victims to pay themselves for the service.

It is illegal to withdraw savings from a self-managed super fund before you turn 65.

James O’Halloran, a deputy tax commissioner, confirmed the ATO was aware of these dodgy scheme promoters, and warned it could cost people thousands in fines and fees.

“While we have seen these promoters using word of mouth and focused in some geographic areas, such as Western Sydney … we believe it is not widespread,” he said. “Attempting to access your super early in this way is illegal.”

The ATO has evidence of promoters promising they can organise access to superannuation savings, asking their clients to fill out blank forms and providing identity documentation. Legislation introduced by Revenue Minister Kelly O’Dwyer makes sweeping changes to superannuation accounts, including forcing the transfer of those with $6000 or less which have been inactive for more than a year to the Commissioner of Taxation so they can be protected from extra fees and charges.