I have received validation error CMN.ATO.SMSFAR.436636 when validating The SMSF Annual Return.
If 'current exempt pension income' is greater than zero then SMSF has exempt income and non-deductible expenses for that exempt income. Details of non-deductible expenses must be provided
If there is current exempt pension income, the ATO expects there would be non-deductible expenses as well.
However, in some funds, this is not always the case.
- record $1 to Bank Charges and re-creating entries to ensure the validation error passes; or
- manually enter $1 into the tax return under Other Amounts L2 and select the code O - Other expenses not listed elsewhere