Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 409

Avoid these top five errors in your SMSF annual return

Everyone makes mistakes. When it comes to preparing and lodging your self-managed super fund (SMSF) annual return (SAR), you want to get it right. Below are the top five mistakes we've identified and some tips on how to avoid them.

1. Not including a bank account in your funds name

You need a bank account in your fund’s name to manage the SMSF operations and to accept contributions, rollovers of super and income from investments. You need to report this account when lodging your SAR.

The account must be separate from your trustees’ individual bank accounts and any related employers’ or advisers' bank accounts. This will protect your fund's assets and ensure super payments can be made to your SMSF.

2. Providing an incorrect electronic service address (ESA)

An ESA allows your SMSF to receive electronic remittance advice and contributions if you have members receiving super from non-related employers.

An ESA consists of alphanumeric characters with a combination of upper and lower case characters and is case sensitive. It's not an email address or the contact details of the SMSF messaging provider.

3. Not valuing SMSF assets at market value

SMSF assets need to be reported at market value as at 30 June to prepare your fund's accounts, statements and SAR. If you follow our valuation guidelines, we'll generally accept the valuation you provide.

Accurate asset valuation is important to ensure your SMSF retains its complying fund status. Penalties may apply for inaccurate valuations as these can have an impact on your members' balances.

4. Trying to lodge with zero assets

An SMSF is not legally established until the fund has assets set aside for the benefit of its members. We won't accept a SAR from an SMSF that has no assets unless the fund is being wound up.

If this is your SMSF's first year and you have no assets set aside for the benefit of your members, you can ask us to either cancel your fund's registration or flag the SMSF's record as return not necessary (RNN).

5. Incorrect or no auditor details in SAR

Your SMSF must have its financial statements and records audited each year by an approved SMSF auditor prior to lodging the Annual Return (SAR). The approved SMSF auditor must be appointed no less than 45 days before your SAR is due.

Make sure you:

  • receive a copy of the audit report before you lodge your SAR.
  • report the correct auditor details on the SAR including the SMSF auditor number, name of auditor and the date the audit was completed.
  • If you lodge your SAR without approved SMSF auditor details, it will be suspended and not recognised as a lodgment. This will impact the complying status of the fund until the SAR is lodged with the required information.

If the auditor details are incorrect, you may also be penalised for making a false and misleading statement.

 

See also: Administering and reporting

Keep up to date: See all recently published SMSF news and alerts

Subscribe to SMSF NewsExternal Link for a monthly wrap-up of news and updates.

 


 

Leave a Comment:

RELATED ARTICLES

Meg on SMSFs: watch traps in EOFY contributions

Every SMSF trustee should have an Enduring Power of Attorney

7 vital steps to compliance for your SMSF

banner

Most viewed in recent weeks

Australian house prices close in on world record

Sydney is set to become the world’s most expensive city for housing over the next 12 months, a new report shows. Our other major cities aren’t far behind unless there are major changes to improve housing affordability.

The case for the $3 million super tax

The Government's proposed tax has copped a lot of flack though I think it's a reasonable approach to improve the long-term sustainability of superannuation and the retirement income system. Here’s why.

7 examples of how the new super tax will be calculated

You've no doubt heard about Division 296. These case studies show what people at various levels above the $3 million threshold might need to pay the ATO, with examples ranging from under $500 to more than $35,000.

The revolt against Baby Boomer wealth

The $3m super tax could be put down to the Government needing money and the wealthy being easy targets. It’s deeper than that though and this looks at the factors behind the policy and why more taxes on the wealthy are coming.

Meg on SMSFs: Withdrawing assets ahead of the $3m super tax

The super tax has caused an almighty scuffle, but for SMSFs impacted by the proposed tax, a big question remains: what should they do now? Here are ideas for those wanting to withdraw money from their SMSF.

The super tax and the defined benefits scandal

Australia's superannuation inequities date back to poor decisions made by Parliament two decades ago. If super for the wealthy needs resetting, so too does the defined benefits schemes for our public servants.

Latest Updates

Planning

Will young Australians be better off than their parents?

For much of Australia’s history, each new generation has been better off than the last: better jobs and incomes as well as improved living standards. A new report assesses whether this time may be different.

Superannuation

The rubbery numbers behind super tax concessions

In selling the super tax, Labor has repeated Treasury claims of there being $50 billion in super tax concessions annually, mostly flowing to high-income earners. This figure is vastly overstated.

Investment strategies

A steady road to getting rich

The latest lists of Australia’s wealthiest individuals show that while overall wealth has continued to rise, gains by individuals haven't been uniform. Many might have been better off adopting a simpler investment strategy.

Economy

Would a corporate tax cut boost productivity in Australia?

As inflation eases, the Albanese government is switching its focus to lifting Australia’s sluggish productivity. Can corporate tax cuts reboot growth - or are we chasing a theory that doesn’t quite work here?

Are V-shaped market recoveries becoming more frequent?

April’s sharp rebound may feel familiar, but are V-shaped recoveries really more common in the post-COVID world? A look at market history suggests otherwise and hints that a common bias might be skewing perceptions.

Investment strategies

Asset allocation in a world of riskier developed markets

Old distinctions between developed and emerging market bonds no longer hold true. At a time where true diversification matters more than ever, this has big ramifications for the way that portfolios should be constructed.

Investment strategies

Top 5 investment reads

As the July school holiday break nears, here are some investment classics to put onto your reading list. The books offer lessons in investment strategy, financial disasters, and mergers and acquisitions.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.