What this Practice Statement is about
Compliance treatments – general principles
What an education direction is
Circumstances in which an education direction can be given
Considerations when deciding whether to give an education direction
Time to comply with an education direction
Varying or revoking an education direction
Applying administrative penalties for failing to comply with an education direction
Objecting to our decisions
More information
Compendium
The ATO published responses to 8 submissions on this ruling in PS LA 2026/1EC. Outcome labels are heuristic — read the ATO response for the detail.
1As drafted, education directions could be applied to minor or inadvertent breaches, risking disproportionate outcomes. A minimum materiality threshold should apply to avoid directions for immaterial breaches or administrative oversights, particularly where the issue has been rectified. It is recommended that the final Practice Statement introduces a minimum materiality threshold to ensure directions are reserved for matters where mandated education is genuinely warranted. For minor or inadvertent breaches, voluntary education may be encouraged instead of a direction.accepted
ATO response
We consider that requiring a minimum materiality threshold to be satisfied for section 160 to be applied would unnecessarily fetter the legislative power conferred by the plain words of this provision. Neither the SISA nor the Superannuation Industry (Supervision) Regulations 1994 (SISR) predicate the giving of an education direction on the basis of the materiality of the relevant contraventions. We further note that education directions are issued where the person's lack of knowledge or understanding of their obligations has contributed to a contravention of the SISA or the SISR. The intention of an education direction is to ensure the person acquires appropriate knowledge relating to the contravention that has occurred and to give them the opportunity to improve and refresh their overall knowledge of the superannuation laws, thus reducing the likelihood of contraventions being committed in the future. This is consistent with paragraphs 2.54 and 2.55 of the Explanatory Memorandum to the Tax and Superannuation Laws Amendment (2014 Measures No.1) Bill 2014 that inserted section 160 into the SISA.
2We strongly object to the reference to an 'accredited SMSF adviser' as a proxy for expected knowledge. This terminology indirectly targets a professional designation and should not appear in ATO administrative guidance. It is recommended that the final Practice Statement removes the reference to 'accredited SMSF adviser'.