An Australian woman has been slammed with a $220,000 penalty after illegally withdrawing funds from other Australians’ super.
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The woman had assisted 68 Australians to establish or begin to establish 35 different self-managed superannuation funds (SMSFs), from which she then assisted them to withdraw their superannuation before they had reached the legal age to access super, the Australian Tax Office (ATO) said.
Australians can only withdraw their superannuation when they are 65 and older, or in extreme circumstances.
The woman was not a registered financial adviser or tax agent, but often charged a fee to clients who were not legally entitled to access their super. In some cases, she transferred the super from a regulated fund to an SMSF, and then withdrew the super within one day.
“Schemes like this cause considerable financial disadvantage to people who can least afford it,” Assistant Commissioner Dana Fleming said.
“It’s not just the money they won’t have at retirement. People who access their super illegally may also need to pay tax on the funds they illegally accessed, along with penalties and interest.”
In fact, if you break the superannuation age limits, you can be hit with fines of up to $16,800.
The recipients then spent the money on personal expenses like stamp duty and home renovations.
“If you come across a tax or super scheme and you’re not sure it’s okay, get a second opinion,” Fleming added.
“There are simple checks you can undertake yourself, or you can talk to a registered tax professional for sound advice.”
Around this time last year, Australians living in retirement hot-spot, Coffs Harbour, were warned to keep an eye out for SMSF spruikers.
The ATO said those spruikers were approaching people at shopping centres and in the street, offering to help people withdraw super early to pay for things like cars or pay off debts.
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