Category: Industry Update

Cloudoffis launches
Workpapers Sorted, unveiling expanded AI-powered functionality

Sydney, 12 March 2026:

Cloudoffis, Australia’s leading cloud-based technology provider for accounting and SMSF advisory firms, has today officially launched Workpapers Sorted, an evolution of its flagship workpapers platform formerly known as Tax Sorted, bringing the product’s scope, capability and AI-driven innovation to new markets.

This evolution reflects the platform’s expansion beyond tax-specific workflows into a comprehensive, AI-powered workpapers solution designed to standardise processes, improve compliance and streamline accounting and advisory operations.

Originally introduced to address inefficiencies in tax workpapers, the platform has rapidly evolved into a broader ecosystem that integrates deeply with Xero, Microsoft Excel, FYI, DocuSign and the ATO to support firms across a wide range of accounting and compliance workflows.

John Munden, Chief Strategy Officer at Cloudoffis, said the launch represents the next chapter in the company’s product strategy.

“When we first brought Tax Sorted to market, our focus was solving inefficiencies in tax workpapers. Since then, the platform has evolved well beyond that initial use case,” Munden said.”

“Workpapers Sorted reflects the reality of what the product delivers today – an AI-powered workpapers ecosystem that integrates multiple data sources, automates manual processes and gives firms greater visibility across entities and group structures.”

“This isn’t simply a name change – it’s an evolution of where we envision the product going. It signals the innovation happening within the platform and our ambition to support practices with smarter, more connected workflows.”

The launch of Workpapers Sorted coincides with a series of major product enhancements that underscore Cloudoffis’ continued investment in innovation.

Recent updates include:

  • Client Tax History at a Glance – a new “Lodged as per ATO” column within Job Financial Reports, displaying four years of lodged income tax return data in a single view to support more accurate preparation and review.
  • Improved FYI document upload experience – enhanced file-type visibility within the FYI document screen, making it easier for teams to identify and upload the correct supporting documentation.
  • Enhanced workpapers library – improvements to calculation reliability and the addition of new templates including Accounts Receivable, Accounts Payable and Depreciation Schedule (as per accounts).

Further innovations rolling out in the coming months include:

  • A redesigned PDF workpaper package format focused on readability and review efficiency during finalisation.
  • An Excel-style file viewer within the document section, allowing spreadsheets to open in their native format rather than converting to PDF.
  • Continued enhancements to workflow automation and reporting modules.

Workpapers Sorted uses AI to automate data ingestion from supporting documents, Xero files and ATO information, reducing manual entry and improving accuracy. Users can refresh client data with a click, generate real-time trial balance, balance sheet, profit and loss and general ledger reports, and post journals back to client files directly within the platform.

Existing customers will experience no disruption to service, pricing or integrations. Login credentials and current integrations remain unchanged, with the updated name and branding now live across the product, website, support documentation and partner marketplaces.

“The firms that shaped this product were with us from the beginning. They came on the journey, gave us feedback, and we built it. Most of our clients have been with us for more than four years, and harnessing those relationships is how Workpapers Sorted was made – and it’s how we’ll keep developing it.

“There are other solutions in the market that aim to remove humans from the process entirely. That’s not what we’re about. We’re focused on being a human business – one where AI accelerates the work, but the judgement, the relationships and the expertise always stay with the people,” Munden said.

“Our priority has been ensuring a seamless transition, and Cloudoffis will continue to provide the same support and innovative technology our customers rely on. Firms can continue using the platform exactly as they do today – with the added benefit of ongoing feature releases designed to standardise workflows, strengthen compliance and improve efficiency across their practice.”

The launch of Workpapers Sorted reinforces Cloudoffis’ commitment to delivering practical, AI-driven solutions that help accounting and advisory firms focus on higher-value client work.

For more information, please visit: https://cloudoffis.com.au.

ENDS

About Cloudoffis

Cloudoffis is a cloud-based technology provider for accounting and advisory firms in Australia, delivering AI-powered workpapers and workflow solutions that improve standardisation, efficiency and compliance. By integrating with leading platforms including Xero, Microsoft Excel, FYI and the ATO, Cloudoffis helps practices eliminate manual processes and focus on higher-value client work.

For further information or to arrange interviews, please contact:
Jasmine Turvey – Reverb Media
E: jasmine@reverb-media.com.au
P: 0437 620 320

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SMSF Insights with Graeme Colley - A Q&A

Read the latest Q&A with Graeme Colley, a respected educator, policy advisor, and technical expert with over 30 years’ experience in taxation and superannuation.

Is the average of SMSF members/trustees increasing?

Based on the information compiled by the ATO from SMSF Annual Returns, there is a slight variation in the age of members/trustees at the time the SMSF is established. The latest statistics compiled from the 2019-20 to 2023-24 SMSF Annual Returns show that the median and average member age in the year an SMSF is established is between ages 46 and 47. However, the average and median age of all members is around age 62.

There appears to be a decrease in the proportion of individuals establishing SMSFs who are aged under 35 and between 55 and 59. There is an increase in the proportion of individuals establishing funds who are aged between 35 and 54.

Age ranges of SMSF members as at 30 June 2025

The following table, published by the ATO and based on data compiled by the
Australian Business Register, shows:

  • The approximate age distribution of SMSF members at 30 June 2025
  • The age distribution of members of SMSFs established in each income year from 2019-20 to 2023-24

The main points of the data are:

  • As at 30 June 2024, both the average age and the median age for all SMSF members were 62 years
  • The median age of SMSF members of newly established funds in 2023-24 was 46 years
Age distribution of all SMSF members at June 2024, and members by the establishment year of the SMSF

Age Distribution of All SMSF Members at June 2024, and Members by Establishment Year of the SMSF

Age Range All Members 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20
< 25 0.6% 1.2% 1.4% 1.4% 1.4% 1.7%
25 – 34 2.7% 8.5% 8.2% 9.9% 9.9% 12.2%
35 – 44 12.2% 35.6% 33.4% 35.0% 34.1% 32.8%
45 – 49 9.5% 18.1% 17.6% 17.7% 18.5% 17.7%
50 – 54 11.9% 15.9% 16.6% 15.6% 15.6% 14.8%
55 – 59 12.3% 10.8% 11.8% 10.8% 11.2% 11.1%
60 – 64 12.6% 6.0% 6.5% 5.8% 5.8% 5.8%
65 – 69 11.5% 2.6% 2.9% 2.5% 2.3% 2.5%
70 – 74 10.0% 1.0% 1.2% 0.9% 0.8% 1.0%
75 – 84 13.7% 0.4% 0.5% 0.4% 0.3% 0.4%
85+ 3.0% <0.1% <0.1% <0.1% <0.1% <0.1%
Total 100% 100% 100% 100% 100% 100%
Average member age 62.0 47.0 47.4 46.5 46.6 46.2
Median member age 62.4 46.2 47.0 46.0 46.2 46.0

Source: ATO SMSF Annual Overview 2023-24 Self Managed Superannuation Funds
Updated 17/12/2025

Members of SMSFs as at the end of June 2025

The following table contains the age distribution of individuals who were members of SMSFs as at the end of June 2025 and is based on Australian Business Register (ABR) data.

Table 6: Members, by Gender and Age Range
Age ranges Male Female Total
< 25 0.6% 0.6% 0.6%
25–34 2.7% 2.8% 2.7%
35–44 11.8% 12.7% 12.2%
45–49 9.5% 9.5% 9.5%
50–54 11.7% 12.1% 11.9%
55–59 12.1% 12.5% 12.3%
60–64 12.5% 12.7% 12.6%
65–69 11.4% 11.6% 11.5%
70–74 10.0% 10.1% 10.0%
75–84 14.3% 13.0% 13.7%
85+ 3.5% 2.4% 3.0%
Total 100% 100% 100%
All ages 52.7% 47.3% 100%

Source: ATO SMSF Quarterly Statistical Report – September 2025
Self Managed Superannuation Funds – Updated 17/12/2025

If the fund owns real estate, is the auditor required to obtain a title search each year indicating its ownership and whether it is encumbered. Is there an alternative?

Both the ATO and the Administrative Review Tribunal consider it is necessary that a title search be undertaken each year to satisfy the requirements of the Superannuation Industry Supervision Act (SIS Act). The search is required to establish that the trustees have met the requirements of section 65 of the SIS Act and regulations 4.09A and 13.14 of the SIS regulations.

The reason for requiring the title search each year are:

Section 65: loans or financial assistance to members

To check whether the fund has met the requirements of section 65, the auditor
must be satisfied that the fund has not lent money or provided financial
assistance to members and relatives. This requires the auditor to:

  • Examine bank statements and obtain explanations from trustees about any
    unusual transactions, including transfers of money to members or relatives
  • Check details of all loans by the fund, including the parties to the loan,
    loan term, interest and repayments
  • Check any transactions with related parties to determine whether members
    or relatives have received financial assistance
  • Review the ownership of fund assets to ensure the investment is owned by
    the fund and that no charge or other form of security has been taken over
    any of the SMSF’s assets to secure a member’s or relative’s personal borrowing

Whether the fund’s assets have been used to secure borrowing can only be
determined by a title search or other independent verification.

Regulation 4.09A: separation of assets

To determine whether the fund’s money and assets are held separately from money and assets held personally by the trustees or a standard employer-sponsor the auditor should:

  • sight asset ownership documents, including bank statements, to verify SMSF assets are held in the name of trustees on behalf of the fund (for example, R & J Smith as trustees for the Smith SMSF or R Smith Pty Ltd as trustee for the Smith SMSF)
  • scheck for alternative documentation that protects the fund’s assets (for example, a valid declaration of trust or title documents) where State law prevents ownership in the name of the SMSF
  • sreview transactions on bank statements to ensure fund money is not mixed with money belonging to related parties of the SMSF.
Regulation 13.14: charges over assets

The auditor needs to check that the fund has complied with regulation 13.14 to confirm that the trustees have not given a charge over or in relation to a fund asset by obtaining:

  • written representations from the trustees
  • annual property title searches for real properties
  • searches of the Personal Property Securities Register External Link for interests registered by other parties against SMSF assets.

Where there has been a change in trustees, the auditor should obtain evidence that the ownership of asset documents reflect the change.

An update on Court and Tribunal Decisions

Reviews by regulators and the courts in recent years show that proper documentation is essential. One case is the Administrative Review Tribunal decision in Murphy v ASIC [2025] ARTA 75 (6 February 2025).

In the case, the ATO reviewed the audit files of Mr Murphy which were referred to ASIC because of various auditing and independence breaches. One of the fund’s audited showed

● no evidence of the ownership of a property in Victoria as no title search was undertaken for for the relevant year(s),

● failed to determine whether a borrowing complied with s67 of the SIS Act – trustees were concerned about compliance, and

● deficiencies in the audit engagement letter issued by Mr Murphy for the audit which resulted in the trustees being concerned about compliance.

The Tribunal confirmed the ASIC decision to disqualify Mr Murphy’s registration as an SMSF auditor.

Given the rules surrounding non-arm’s length income (NALI) , if someone processes their own SMSF by using the firm’s software which is not material to the firm, what are the consequences?

The answer to this question can be found in the finalised version of Law Companion Ruling LCR 2021/2 which was published in September 2025. The ruling clarifies how the non-arm’s length provisions of the tax law work for non-arm’s length expenditure incurred by an SMSF.

Example 2 at paragraphs 24 to 26 of the ruling is about Mikasa who is a trustee of her SMSF and a partner in an accounting firm. She engages her firm to provide accounting services for the SMSF which include administration services for the fund. The firm does not charge for the services it provides and as a result they are considered to be non-arm’s length dealings between the firm and the fund trustee. In view of this the ATO’s opinion is that a penalty applies to the non-arm’s length income for purposes of section 295-550 of the SIS Act. The penalty is equal to twice the difference between the amount of the expense that might have been incurred has the parties been dealing at arm’s length and the amount of the expense incurred by the fund.

There is an exception to this in Paragraph 51 of the ruling where a staff discount policy applies and the fund is entitled to a discount which is provided to all employees, partners, shareholders or office holders and it is consistent with normal commercial practices.

With an increase in the number of SMSF auditors being disqualified, what should I do? How can technology help me?

This question is not easy to answer as we do not know about your situation. However, provided you are meeting the ATO’s compliance audit requirements and the professional audit standards then you should not have any issues to be concerned with. You may like to contact your professional association to see whether they have a review service which can let you know whether you meet the relevant audit requirements.

It’s important to look at your overall audit process and where you can create more efficiencies and avoid any compliance issues. There are many platforms that allow you to streamline this process. SMSF Auditomation, by Cloudoffis allows you to streamline your process and ensure you are audit ready.

If you’d like to speak to one of the Cloudoffis experts, you can reach out here.

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Understanding Division 296 from what we know by Graeme Colley

Introduction:

Graeme Colley, who is a well-known expert in SMSFs and the Cloudoffis Independent Consultant, has provided an update on the latest developments for Div 296.

Understanding Division 296 from what we know

The reworked Division 296 legislation, Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026, finally made it to parliament in February this year after going through many changes since it was announced in the 2023-24 Federal Budget. The main changes in the bill are a move away from taxing unrealised capital gains and the indexation of the thresholds. There are a number of other important changes that have taken place and should be understood if the legislation finally makes it into law.

The current bill continues to reduce superannuation tax breaks for anyone with a total super balance of more than $3 million and places an additional impost on those with balances of more than $10 million. An individual’s realised fund earnings from 1 July 2026 is taxed if their total super balance for Division 296 purposes is above the relevant threshold.

The main features of the bill are:

  • The legislation is proposed to commence on 1 July 2026 rather than 1 July 2025 as originally proposed.
  • For anyone with a superannuation balance of $3 million or more the tax will be a maximum of 15% of the realised income for the relevant financial year. If a person has a superannuation balance of $10 million or more there is an additional impost of 10% on the realised income.
  • The realised income is based on income tax principles rather than the concept in the original proposal which taxed the difference between the individual’s opening and closing superannuation balances for the year. It is calculated at the fund level and an amount is attributed to the relevant member. For an SMSF it is expected an actuary will make the calculation.
  • Trustees of SMSFs will have the option of resetting the cost base of the fund’s investments as at 30 June 2026 to recognise the level of accrued value in the investment to that time. The option is only available on all of the fund’s investments and applies only for purposes of Div 296.
  • The calculation of Div 296 tax consists of three stages:

    • Stage 1 – Percentage formula (s 296-40(2))
    • Stage 2 – Div 296 fund earnings (s 296-45(2))
    • Stage 3 – Taxable superannuation earnings (s 296-40(1))
  • Division 296 tax is levied on the individual who has the option of paying the tax from their own resources or having the superannuation fund pay the liability.

Stage 1 – the percentage formula

The percentage formula determines the proportion of a person’s balance that is above each of the thresholds. There is one formula for calculating the proportion above $3 million and another which calculates the proportion of a person’s balance above $10 million.

The formula that applies where the person’s total superannuation balance is at least $3 million is:

Where:

The total superannuation balance reference amount is the greater of a person’s total superannuation balance (if any):

• just before the start of the year; and

• at the end of the year.

The large superannuation balance threshold is $3 million (or indexed threshold) for the year.

Note: for the 2026-27 financial year (the first year of operation) the year end figure will be used in the calculation.

The examples of Judi and Brad illustrate how Division 296 tax will be calculated for someone who has a total superannuation balance of greater than $3 million in the case of Judi and in the case of Brad, $10 million.

Example

Judi has a Total Superannuation Balance (TSB) of $4 million on 30 June 2027 and a TSB of $3.5 million on 30 June 2026. Her total superannuation fund earnings for the year is $100,000 which means she will have a tax liability for Division 296 purposes.

As Judi’s TSB on 30 June 2027 is $4 million it will be used to calculate the percentage of her TSB that is over and above her large superannuation balance.

The proportion of Judi’s TSB above the $3 million threshold is 25% which is calculated as:

Total Superannuation Balance above $10 million

The second formula which is used to calculate the additional tax impost on TSBs above $10 million is:

Where:
The total superannuation balance reference amount is the greater of a person’s total superannuation balance (if any):

• just before the start of the year; and

• at the end of the year.

The very large superannuation balance threshold is $10 million (or indexed threshold) for the year.

Note: for the 2026-27 financial year (the first year of operation) the year end figure will be used in the calculation.

Example

Brad has a TSB of $12 million as at 30 June 2027 and a TSB of $10.5 million on 30 June 2026. His total superannuation fund earnings for the year is $1,000,000 which means he will have a tax liability for Division 296 purposes. As Brad’s TSB is greater than the very large superannuation balance of $10 million he will be required to pay additional tax.

The proportion of Brad’s TSB above the $3 million threshold is 75% which is calculated as:

The proportion of Brad’s TSB which is above the $10 million threshold is 16.67% which is calculated as:

Stage 2 – Div 296 Fund earnings

Stage 2 determines the fund earnings for Division 296 purposes which is calculated at the fund level not the member level. Once the fund earnings has been determined a further calculation is made to work out the amount of fund earnings that applies to the member. At this stage (as at 19 February 2026) the method used to calculate the member amount is not available as it will be included in the regulations if the bill becomes law.

The formula to determine the fund earnings is:

Where:

Relevant taxable income or loss is the fund’s taxable income for the year,

Assessable contributions are the taxable contributions included in the fund’s income for the year,

Net exempt current pension income is the fund’s exempt income less the total deductions if the exempt income was assessable income.

The entity’s non-arm’s length component for the year (if any) is the amount of income that is taxed as NALI by the fund.

Pooled superannuation trust component applies if the fund has an investment in such a trust.

Example – Judi

Using the example of Judi above the fund’s taxable income is $350,000, assessable contributions claimed by the fund are $60,000 and the fund’s net current pension income less expenses is $310,000. The fund does not have any non-arm’s length component or investments in a pooled superannuation trust. Therefore the fund earnings for Division 296 purposes is $600,000. It is determined by an actuary (as proposed) that the proportion of the Div 296 fund earnings attributable to Judi is $100,000.

Example – Brad

The Div 296 fund earnings attributable to Brad has been calculated as $1,000,000.

Stage 3 – Taxable superannuation earnings

Taxable superannuation earnings is calculated as:

The percentage amount ×the Div 296 fund earnings

which involves multiplying the percentage amount from Stage 1 by the Div 296 fund earnings calculated in Stage 2.

Example – Judi

Judi’s taxable superannuation earnings is calculated as:

25% ×$100,000=$25,000

The amount of tax payable on Judi’s large superannuation balance is:

$25,000 ×15%=$3,750

Example – Brad

Tax on Brad’s large superannuation earnings

Brad’s taxable superannuation earnings is calculated as:

$1,000,000 ×75%=$750,000

The amount of tax payable on Brad’s large superannuation earnings is:

$750,000 ×15%=$112,500

Tax on Brad’s very large superannuation balance earnings

Brad’s very large superannuation earnings is calculated as:

The percentage amount ×the Div 296 fund earnings

The percentage amount on Brad’s very large superannuation earnings is 16.67% and Brad’s superannuation earnings is $750,000. Therefore the amount of tax payable on Brad’s very large superannuation balance is:

16.67% ×$750,000=$125,025

The amount of tax payable on Brad’s very large superannuation earnings is:

$125,025 ×10%=$12,502.50

The total Div 296 tax payable by Brad will be:

$112,500+12,502.50=$125,002.50

The Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 is yet to be debated in both houses of the parliament which may result in a number of changes if the legislation is passed and becomes law. Also, as the regulations will not be made until the legislation is passed there are some aspects which are not known at this stage as indicated above. Therefore the examples above are based on the bill and indicative of how Division 296 will operate.

Want to know more?

Graeme recently hosted a webinar on this topic which you can watch here.

We will also be hosting more webinars and events with Graeme in the coming months.





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The Cloudoffis Bulletin – December Edition

Welcome to the last Cloudoffis Bulletin of 2025! The team at Cloudoffis wishes our wonderful community a restful and enjoyable break over the holidays.

This month, we have a jam-packed newsletter for you – featuring some really insightful updates from industry expert Graeme Colley and some great content featuring Tyler Caskey and Heather Smith. Sit back and enjoy this read.

We look forward to catching up with many of you in the coming weeks.

Latest News

Reimagining workpapers with an industry expert Tyler Caskey

Get your Workpapers Sorted with Cloudoffis

If your workpaper process could use some efficiencies as you head into 2026, learn more about how one of our customers, Paul Money, transformed his workpaper process with Workpapers Sorted, by Cloudoffis.

Enjoy this special demo with Heather Smith

If you like what you see, you can book a personalised demo with the team today.


A special event in Sydney

Thank you to our wonderful community for joining the team for our last event of 2025! It was a pleasure to invite our partners, customers, and industry experts for an evening of insights and celebration.

We look forward to welcoming you at more events in 2026!

SMSF Death Benefits Checklist

When we host our quarterly Ask Graeme webinars, one question which always arises is around the topic of SMSF death benefits. Our team worked with Grame Colley on putting together this checklist to help you and your clients ensure you are asking the right questions on this topic.


An update on Division 296, by Graeme Colley

Division 296 has been a hot topic this year, and with recent updates to this legislation

we got an update from industry expert Grame Colley on what this means for you.


What’s new with Workpapers Sorted

Improved FYI Document Upload Experience 🙌

We’ve added clear file-type icons within the FYI Document screen, making it easier to identify and select the correct format when uploading documents for your workpapers.

Client Tax History at a Glance 📘

A new “Lodged as per ATO” column is now available in the Job Financial Reports screen.

This displays the past four years of lodged Income Tax Return information, giving preparers immediate visibility of the client’s history in a single view—supporting more accurate workpaper preparation and tax return reviews.

Enhanced Workpapers ✅

We’ve made a series of improvements across our workpapers to ensure more reliable and accurate calculations, along with the addition of new workpaper templates to support a broader range of scenarios. (Accounts Receivable, Accounts Payable, Depreciation Schedule as per Accounts)

Coming in December:

New PDF Workpaper Package Format 🙌

  • We’re introducing a redesigned PDF package for workpapers.

  • The new format focuses on readability and review efficiency, helping preparers and reviewers navigate documentation more easily during the finalisation process.

Excel File Viewer in the Document Section ✅

  • Excel uploads in the document section will soon open directly in an Excel-style view rather than converting to PDF.

  • This improvement ensures better clarity and preserves the original structure of your spreadsheets.

Are you ready to grow with Cloudoffis?

Whether your practice specialises in auditing or offers a full suite of accounting and advisory services, Cloudoffis has you covered with streamlined workpapers and workflows. Cloudoffis is here to help keep your practice running smoothly.

  • Quick Setup – Get started in minutes

  • Flexible Platform – Work the way you want with adaptable features and integrations

  • AI, Cloud-Based Technology – Delivering efficiencies and compliance at scale

  • Flexible Pricing & Unlimited Users – No lock-in contracts

  • Free Onboarding & Ongoing Training – Onboard your team effortlessly with expert guidance and continuous support at no extra cost

  • Tailored Solutions – Our agile team adapts to your unique business needs to ensure your success








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Graeme’s Super News - A look back on SMSF in 2025

Graeme’s Super News – A look back on SMSF in 2025

Read the latest updates from Graeme Colley, a respected educator, policy advisor, and technical expert with over 30 years' experience in taxation and superannuation.

In Graeme’s final update of 2025 – he reflects back on 2025 while adding some thoughts to what 2026 may hold.

Welcome to the end of another year and our last newsletter for 2025. This year has given us some possible changes to super, rulings from the regulators and greater obligations for super fund auditors.

Giving the gift of super

But seeing it’s the festive season and a time of giving, why not give a gift that lasts the test of time, like super. Give yourself a Christmas present by making personal contributions to super, increasing your salary sacrifice or helping family members boost their retirement savings. While contributions to super may not have an immediate impact, they may actually give a substantial long-term benefit.

Good fund administration

When looking back at the year, the main super issues centre on maintaining good fund administration. This includes making sure pensions are paid correctly and that auditors carry out
their professional duties properly.

An important change to anyone receiving a pension is to make sure that at least the minimum amount is paid. Failure to meet this requirement results in the pension ceasing from the start of that financial year, and all payments being treated as lump sums. Anyone wishing to recommence the pension must go through the process of starting a new pension in the next financial year with entirely new documents as well as calculations.

Underpaying the pension means additional income tax for the fund, as the amount supporting the pension will be treated as being in the accumulation phase for the year of the underpayment. Also, there may be transfer balance cap issues when the pension is stopped and if a new pension commences. One good way of making sure at least the minimum amount is paid can be to arrange for direct debits from the fund accounts to the pensioner. That way, there is a greater risk of the pension complying with the rules.

Something for auditors

For auditors, this year provided a number of salient lessons from the regulators and the courts as they took a tougher line on the need to maintain records and gather appropriate evidence in support of the auditor’s conclusions. Failure to meet these requirements resulted in many auditors being disqualified to audit an SMSF.

If you’ve been in this position before and are looking to avoid this in 2026, you should consider speaking to the team at Cloudoffis, whose technology helps maintain records in the cloud.

Division 296

The reannouncement of Division 296 tax on the increase in super balances above $3 million raised it’s head again. However, changes were made due to the reaction of the public and professional associations. The result was a rework of the basic proposed rules to include a second threshold of $10 million, indexation of the thresholds as well and including only realised gains in the calculation.

It is expected that the Division 296 proposal will show its head again early next year and be passed in time for it to commence on 1 July 2026. It will be interesting to see whether it will make it into law and how the changed proposal will operate.

Payday Super

Unlike the Div 296 tax, Payday Super is law and will commence from 1 July 2026. That legislation requires employers to pay super contributions at the same time as an employee’s salary and wages. In view of the effort required by employers to upgrade their payroll systems, the legislation provides a transitional period to comply with the new law. A draft of the ATO’s compliance approach in the first year of Payday Super for the 2026/27 financial year is published in PCG 2025/D5.

So summing up, it’s been another challenging yea,r and next year looks like it will be no different as we do our best to comply with the continuous changes in super. All the best for the holiday season.

Are you ready to grow with Cloudoffis?

Whether your practice specialises in auditing or offers a full suite of accounting and advisory services, Cloudoffis has you covered with streamlined workpapers and workflows. Cloudoffis is here to help keep your practice running smoothly.

  • Quick Setup – Get started in minutes
  • Flexible Platform – Work the way you want with adaptable features and integrations
  • AI, Cloud-Based Technology – Delivering efficiencies and compliance at scale
  • Flexible Pricing & Unlimited Users – No lock-in contracts
  • Free Onboarding & Ongoing Training – Onboard your team effortlessly with expert guidance and continuous support at no extra cost
  • Tailored Solutions – Our agile team adapts to your unique business needs to ensure your success
Book a demo








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Graeme’s Super News - November Edition

Graeme’s Super News – November Edition

Read the latest updates from Graeme Colley, a respected educator, policy advisor, and technical expert with over 30 years’ experience in taxation and superannuation.

Welcome to some of this month’s roundup of key developments with SMSFs. From ATO compliance initiatives to ASIC audit reviews, make sure you’re up to date.

ASIC Flags Auditor Independence Breaches

ASIC recently released Report 817 – Building trust: Auditor compliance with independence and conflict of interest obligations. The report followed ASIC enforcement action taken against several auditors and firms identified as not meeting the independence and conflict of interest requirements.

Nearly one-third of the 48 auditors reviewed breached the mandatory independence requirements. Nine auditors failed to meet rotation requirements for 14 listed clients, and five held prohibited relationships under the Corporations Act. These breaches were found across all sizes of audit firms reviewed.

The source of the breaches was due to poor systems, lack of policies, carelessness, and inadequate quality control. ASIC considered that many auditors adopted a narrow, “tick-box” approach to compliance and failed to consider threats to independence or changing circumstances during audits. Some relied on inappropriate safeguards and did not document how they assessed independence risks.

Examples of threats included excessive non-audit fees—sometimes five times higher than audit fees—and long-standing relationships between auditors and clients, some lasting up to 36 years. ASIC emphasised that independence is fundamental to audit quality and encouraged all auditors to strengthen their practices and policies.

ATO Cracks Down on Late SMSF Lodgements

The ATO is taking a tougher stance on late lodgement of SMSF annual returns. About 10% of 2022/23 returns remain outstanding, and similar figures are expected for 2024. The ATO’s experience is that late lodgement often signals illegal early access or other compliance issues.

Consequences for late lodgement include removal of the fund from Super Fund Lookup, which restricts contributions and rollovers, and potentially may result in trustee disqualification.

Continued non-lodgement may trigger harsher penalties. The ATO advises trustees to respond promptly to any ATO correspondence and avoid ignoring compliance letters.

Trustee Declaration Requirements Clarified

Since 2007, SMSF trustees have been required to complete the ATO trustee declaration within 21 days of appointment and retain it for at least 10 years. Auditors are required to sight the original declaration and keep a copy in their audit file, along with annual confirmations that trustees continue to retain it.

However, many auditors only review copies and request new declarations when originals are lost. The ATO has clarified that if the original cannot be sighted, a new declaration must be signed. A once-off breach can be rectified, but repeated failures require an Auditor Contravention Report (ACR).

Auditors should not be lodging ACRs annually for the same fund due to missing originals if the breach has been rectified.

Market Valuation Breaches Increasing

Breaches of regulation 8.02B of the SIS Regulations, which requires SMSF assets to be valued at market value, accounted for 12% of all reported breaches in 2024–25. Trustees must ensure that valuations for each income year are accurate, in line with the ATO’s valuation guidelines and provide supporting evidence to auditors.

The ATO is using data analytics to identify funds which have reported unchanged asset values year after year, raising concerns about compliance. Failure to meet valuation requirements can result in additional tax liabilities and administrative penalties.

Auditors must assess whether the valuation basis is appropriate and document their findings. Trustees are reminded to provide objective, supportable evidence, including all documents requested by auditors.

SMSFs Failing to Respond to Release Authorities

The ATO has seen a rise in SMSFs failing to respond correctly to release authorities—documents authorising the release of funds to pay liabilities such as excess contributions, Division 293 tax or possibly Division 296 tax in future. Trustees must release the requested amount and submit a release authority statement within 10 business days of receipt.

Non-compliance can lead to significant penalties. Trustees should regularly check secure mail channels, set reminders, and use SMSF software to track deadlines. Working closely with administrators or tax agents can help ensure timely and accurate responses.

Keeping fund contact details, including electronic service addresses, up to date is essential for receiving important correspondence.

Surge in Compassionate Release of Super

Applications for compassionate release of super (CRS) have surged, particularly for dental treatments. Requests rose from 56,400 in 2021–22 to 90,700 in 2024–25, with costs reaching $104.4 million. Most applicants were aged 34 to 60.

The ATO, in collaboration with AHPRA, is concerned about practitioners supporting inappropriate access, especially for cosmetic procedures. Release on compassionate grounds is only available in limited circumstances, such as treating acute pain or life-threatening conditions, and requires certification from two practitioners.

Practitioners have been warned against providing financial advice without a licence and must ensure medical reports are accurate. New guidance from AHPRA and the Dental and Medical Boards emphasises that treatments should only be certified if necessary.

Writing Off SMSF Loans Requires Documentation

Writing off loans in SMSFs is being scrutinised by the ATO for breaches of the sole purpose test. Trustees need to demonstrate reasonable efforts to recover funds, including legal advice or evidence of insolvency. Without proper documentation, the ATO may see the transaction as illegal early access.

SMSFs generally cannot claim bad debt deductions unless they are in the business of lending. A capital loss may be claimed if the loan was made with a reasonable expectation of repayment.

If a member illegally accesses super, the funds cannot be returned, and any repayment to the fund will be treated as a new contribution. Trustees may face section 65 penalties, civil and criminal sanctions, disqualification, and fund non-compliance. Early access also breaches preservation standards, making the amount assessable income for the member.

Thank you for reading this months’ update.

If you are looking for more SMSF insights, you can watch Graeme’s latest webinar on demand here.



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The Cloudoffis Pulse - Product Updates

Welcome to our first-ever Cloudoffis product newsletter – Cloudoffis Pulse, where we bring you the latest product updates across Workpapers Sorted, SMSF Auditomation and SMSF Sorted.

This month, we’ve some really exciting updates to share with you. Our incredible product team has been working hard to build the products you’ve asked for.

We hope you enjoy this update

From the product desk:

We are pleased to announce that Cloudoffis has successfully attained ISO 27001 certification. At Cloudoffis, safeguarding your data is our top priority. We are proud that we have achieved ISO 27001 certification, the internationally recognised standard for information security management systems (ISMS).

You can learn more about this here.





Book time with your Account Manager:

If you’re looking to elevate your Cloudoffis experience, book 30 minutes with Jocelyn or Dilnar today.

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Graeme’s Super News - October Edition

Read the latest updates from Graeme Colley, a respected educator, policy advisor, and technical expert with over 30 years' experience in taxation and superannuation.

Graeme’s Super News – October Edition

Read the latest updates from Graeme Colley, a respected educator, policy advisor, and technical expert with over 30 years’ experience in taxation and superannuation.

Update on Division 296

Division 296 amends the income tax law to introduce an additional tax of up to 15% on the increase in a person’s Total Superannuation Balance for the year on balances above $3 million. It was intended to take effect from 1 July 2025.

Based on recent media reports the government has paused progression of the tax. If the legislation does make it into to parliament it may not be in the same form as the original bill which lapsed on 21 July 2025. It may be better to wait until we see whether the legislation will go ahead and, if it does, whether any changes are made to the lapsed bills.

It is rumoured that the $3 million threshold may be indexed which may relieve one of the main issues with the legislation. However, the member’s total superannuation balance which is used to determine the threshold may still include unrealised capital gains in the calculation.

At the moment it’s just wait and see what the government proposes to do.

Amendments to superannuation contributions ruling finalised

Taxation Ruling TR 2010/1 Income tax: superannuation contributions has been amended by TR 2010/1A4 to provide the ATO’s view of the link between the non-arm’s length income provisions in section 295-550 of the ITAA ’97 and superannuation contributions. The amendments are relevant for trustees of super funds, particularly SMSFs, in determining whether the non-arm’s length income rules apply when making in specie contributions.

The amendments to TR 2010/1 also cover value shifting arrangements to exclude those occurring from 28 November 2024. But it covers the ATO’s approach to arrangements entered into prior to that date in Appendix 2 of the Ruling.

In relation to determining whether personal contributions are deductible the amended ruling covers the removal of the maximum earnings test which has applied since 1 July 2017.

Amended non-arm’s length income/expenditure ruling finalised

Law Companion Ruling LCR 2021/2 has been amended by LCR 2021/2A3 to clarify how amendments to section 295-550 of the ITAA ‘97 operate in a scheme where the parties do not deal with each other at arm’s length. It applies where the trustee of small complying superannuation funds, such as an SMSF or SAF incurs non-arm’s length expenditure (or does not incur relevant expenditure) in gaining or producing the fund’s ordinary or statutory income.

The revised ruling provides clarity to a range of NALI/E issues including the difference between services provided as a trustee and in a professional capacity.

ATO SMSF Stats for the June Quarter 2025

The latest SMSF quarterly statistics as at June 2025 were released in early September and highlights the continued growth of SMSFs. The ATO statistics show that there are 653,062 SMSFs which have a total of 1,203,127 members.

During the 2024/25 financial year there was an increase of 38,449 funds, which was a substantial increase over each of the previous three years. Nearly two-thirds of the increase in SMSF memberships has come from the younger age groups. Although over 50% of members are in the 60+ age group.

SMSFs now hold over $1 trillion in assets with the largest asset classes being listed shares and cash and term deposits.

The ATO’s SMSF quarterly statistical reports is available from the ATO website at June 2025 ATO SMSF statistics

Government Audit Office Review of SMSFs

The Australian National Audit Office (ANAO), has listed an audit of the ATO’s regulation of SMSFs for the 2025/26 financial year as well as a follow up audit of employer compliance with Superannuation Guarantee. The ANAO last examined the ATO’s management of SMSFs in 2007, and Superannuation Guarantee non-compliance in 2022.

The review of employer compliance with the Superannuation Guarantee requirements, compliments the introduction of the payday super which is due to commence on 1 July 2026.

Cancellation of Auditor Contravention Reports

If you are an SMSF auditor, the ATO must be notified if a reportable contravention under the SIS Act has occurred, is occurring or may occur. The contravention is made by lodging an Auditor Contravention Report (ACR) within 28 days of completing the audit.

However, if the ACR was sent to the ATO because of a genuine error then it can be cancelled. Genuine errors include:

  • lodging under the wrong fund ABN
  • providing incorrect information about the contravention based on the evidence you had in your possession at the time of reporting the contravention to us.

If the information received after lodging the ACR shows that the reported contravention was incorrect, didn’t occur, or has been rectified, a revised ACR should be lodged with the ATO. This can be done by using the ATO’s Online services for business to request a cancellation. If the ATO considers there are valid reasons for cancellation it will reply within 28 days of the request.

Issues with accountants’ wholesale investor certificates

In late June 2025 the Australian Financial Complaints Authority (AFCA) handed down a decision Case number: 12-00-1080719 concerning an SMSF which had invested in Contracts for Difference (CFDs) on the basis that it was a wholesale investor for purposes of the Corporations Act 2001.

AFCA came to the conclusion that the SMSF was a retail client because the financial services provided by the financial firms involved related to a beneficial interest in the SMSF, which was a superannuation product, and the SMSF held less than $10 million in net assets as required under the Corporations Act 2001.

The decision in this case changed a longstanding understanding on the basis of an ASIC Media Release 14-191MR Statement on wholesale and retail investors and SMSFs | ASIC . It indicated that if a superannuation fund held less than $10 million in net assets that ASIC would no action if the advice provider determined that the trustee was a wholesale client based on the general net assets test of $2.5 million applying to the individual. As a general rule this was taken to assume that the SMSF could be treated as a wholesale client.

However, in its decision AFCA pointed out that the Media Release 14-191MR is not a definitive statement by ASIC that the general wholesale client test applies to SMSF trustees in relation to financial services these trustees receive. In effect, the release relates to ASIC not taking action in the circumstances indicated in the Media Release.

The AFCA decision was recently confirmed by their lead ombudsman, Shail Singh, and in the AFCA newsletter dated 19 June 2025 that the Corporations Act treats everyone as a retail investor unless you fall into a category of wholesale.

Qualified accountants who have been asked to provide wholesale investor certificate for purposes of Chapter 7 of the Corporations Act must understand when it can be given for an SMSF and that the net value of the fund’s assets are calculated correctly.



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An update on Division 296 by Graeme Colley

Graeme Colley, who is a well-known expert in SMSFs and the Cloudoffis Independent Consultant, has provided an update on the latest developments for Div 296. 

What’s changed?

On 13 October, the government announced changes to the Div 296 tax proposal, which taxes increases in a member’s superannuation balance above $3 million.  The original proposal was placed under significant pressure by those who were impacted for many reasons.   These included no indexation of the $3 million threshold and the taxation of unrealised capital gains.  

The proposed changes still maintain the overall design of the legislation, which requires the tax to be paid by the member.  However, there are changes to the calculation of the amount to be taxed by excluding unrealised capital gains and introducing two thresholds at which the tax is payable.

The main changes to Div 296 announced by the Treasurer are:

Introduction of two thresholds

Div 296 tax will apply on balances above $3 million, and a further tax will apply on balances above $3 million.

Thresholds indexed

The two thresholds will be indexed in line with increases in CPI.  The $3 million cap will be indexed in increments of $150,000, and the $10 million threshold indexed in increments of $500,000.

Tax on ‘earnings’

The tax rate on the ‘earnings’ for balances above $3 million will be an extra 15% and a further tax of 10% applies if the member’s balance is greater than $10 million.  This means that a member who is wholly in the accumulation phase with a balance of between $3 million and $10 million will pay tax equal to 30% of their adjusted ‘income’, and those with a balance of more than $10 million will pay an additional amount equal to 40% of their adjusted ‘income’.

Calculation of the member’s adjusted ‘earnings’ for Div 296 purposes.

The calculation of a member’s total superannuation balance for Div 296 purposes will be adjusted for contributions, pension payments and other amounts.  The announced changes will now exclude unrealised capital gains, which was a controversial feature of the original proposal. 

If a member has a total amount in super greater than a threshold, the ATO contacts the relevant fund or funds to get further information so the adjustments can be made.  Any ‘earnings’ adjustment will be based on the fund’s taxable income.

Change in commencement date of Div 296

The proposed commencement date of the new tax is now 1 July 2026.  This means that Div 296 assessments will not be sent out to members until sometime in the 2027-28 financial year at the earliest.

Don’t forget that the government’s announcement on 13 October is not law.  There may be further changes when the legislation goes through the parliament, expected early in the new year.  As Div 296 is proposed to commence on 1 July 2026 don’t jump at shadows and make ad hoc decisions until the exact wording of the legislation is known and passed.

Further information on the government’s changes can be located on the Treasurer’s website and the Treasury website.

Want to ask Graeme about this?

Graeme will provide a detailed overview of the government’s Div 296 announcement at our Q&A webinar on 29 October

You can register for the webinar here. 

 

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ATO SMSF Stats for the June Quarter 2025

ATO SMSF Stats for the June Quarter 2025

The latest SMSF quarterly statistics as at June 2025 were released in early September and highlight the continued growth of SMSFs. The ATO statistics show that there are 653,062 SMSFs which have a total of 1,203,127 members.

During the 2024/25 financial year, there was an increase of 38,449 funds, which was a substantial increase over each of the previous three years. Nearly two-thirds of the increase in SMSF memberships has come from the younger age groups. Although over 50% of members are in the 60+ age group.

SMSFs now hold over $1 trillion in assets, with the largest asset classes being listed shares, cash and term deposits.

The ATO’s SMSF quarterly statistical reports is available from the ATO website at
June 2025 ATO SMSF statistics

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