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ATO threatens fines and prosecution for misuse of early super access scheme

June 12th, 2020

Members who took money out of their superannuation without meeting the eligibility requirements could face fines and prosecution, the Australian Taxation Office has warned.

The Coalition’s early super access scheme allows eligible members to withdraw $10,000 in the last three months of this financial year and another $10,000 in the first three months of next financial year.

It is open to members who are unemployed, are eligible for certain government payments, had their hours cut by 20 per cent, or suffered a 20 per cent drop in turnover (sole traders) on or after January 1.

But the bank transactions of 13,000 people who have withdrawn money under the scheme, analysed by credit bureau illion and consultancy AlphaBeta, show nearly half (40 per cent) experienced no drop in income during the coronavirus crisis.

These members were able to withdraw money under the scheme because the ATO is not conducting income checks before approving withdrawals.

The same dataset also showed 64 per cent of money withdrawn via the scheme was spent on discretionary goods – with gambling a close second to debt repayment.

“Instead of learning from the problems with the Robodebt scheme, they’ve just repeated them,” Shadow Assistant Treasurer Stephen Jones told The New Daily.

“They have set up a process with no manual oversight.”

Mr Jones has called for a full review of the system and urged the ATO to conduct spot checks and more rigorous data matching.

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First published on www.thenewdaily.com.au and republished with permission from The New Daily. For the full article visit The New Daily website.