A self-managed superannuation fund’s (SMSF’s) trust deed is one of its most important assets. While legislation sets out what trustees must not do, the trust deed specifies what a trustee is allowed to do. Now’s the time of year to perform the yearly review of the deed. Experts say it can be the ‘make or break’ ... Read more
Guide to SMSF investment rules
An SMSF is a very attractive superannuation savings vehicle but it also comes with plenty of responsibility for anyone that signs up to being a trustee. While most of the time people choose an SMSF because of the freedom of investment choice it provides, it’s important to understand the rules around what you can, and ... Read more
Estate planning, super and SMSFs: Getting your house in order
Estate planning is often overlooked or neglected by superannuation investors. A broad and complex topic, it can be made easier by breaking down the key elements. This article won’t address all financial and legal issues in depth, especially for non-super assets. Instead, in the context of SMSFs, we will highlight ... Read more
How to create an SMSF investment strategy (including examples)
Self-managed superannuation funds are required, under the Superannuation Industry (Supervision) Act 1993, “to formulate, review regularly and give effect to an investment strategy.” What is an SMSF investment strategy? That investment strategy needs to take into account the following things: The risk involved in ... Read more
Guide to SMSFs and insurance
SMSF trustees must consider whether to take out appropriate insurance cover for each member of their fund as part of preparing their investment strategy. It’s a legal requirement for all super funds (including SMSFs) to prepare a documented investment strategy during the SMSF's set-up process. This strategy ... Read more
Did tax kill the transition to retirement magic pudding?
Transition to retirement (TTR) pensions used to be referred to as the Magic Pudding because like Norman Lindsay’s famous cut-and-come-again pud you could have your cake and eat it too. The pudding may be a bit smaller since the government tightened the tax rules back in 2017, but a TTR pension is still appetising ... Read more
Guide to SMSF administration, reporting and record-keeping
SMSF trustees have a number of administrative, reporting and record-keeping obligations to ensure their fund’s compliance with superannuation and taxation legislation. Compliant super funds are eligible for the tax concessions available under Australian superannuation law. Member contributions and fund earnings for ... Read more
Guide to the ATO SMSF supervisory levy
The supervisory levy is an annual payment that all SMSFs must pay to the Australian Taxation Office (ATO). How much is the ATO levy? Currently, the annual SMSF levy is $259. However, it’s important to note that this levy must now be paid in advance (i.e. for the following financial year). Prior to 1 July 2013, the ... Read more
Guide to SMSF trust deeds
An SMSF trust deed is a legal document that outlines how the fund will be set up and how it will operate. An Australian SMSF must be established with a trust deed that is compliant with Australian superannuation legislation. Why is an SMSF trust deed necessary? An SMSF must be set up as a trust. A trust is a type of ... Read more
What to consider when looking for an SMSF provider
There are plenty of SMSF service providers available, ranging from those who offer traditional face-to-face services through to purely online providers. The type of provider you should choose depends on factors such as: Your level of knowledge about SMSFs and investments. The extent to which you want (or ... Read more
Is it possible to have two SMSFs at the same time?
Australian super legislation allows you to establish and run a second SMSF, but it’s important to understand the potential for downsides as well as benefits. More people are considering setting up a second SMSF since the following key changes were introduced to super legislation from 1 July 2017: SMSFs no ... Read more
Guide to SMSF residency requirements
SMSFs must pass residency requirements at all time to be eligible for the tax concessions that are available under Australian superannuation legislation. Member contributions and fund earnings in compliant Australian SMSFs are taxed at the concessional super rate of 15%, up to certain contributions limits. What is the ... Read more
What are the penalties for SMSF non-compliance?
SMSF trustees can face a range of penalties if their funds aren’t set up and managed to comply with superannuation and taxation legislation. These penalties are imposed by the Australian Taxation Office (ATO). Non-compliance penalties are in place to deter trustees from illegally taking advantage of the tax ... Read more
What is a self-managed super fund (SMSF)?
As the name implies, an SMSF (also known as DIY super) is a private super fund that you manage yourself. SMSFs allow their members to have control over how their retirement savings are invested. According to the latest statistics from the Australian Taxation Office (ATO), there are nearly 600,000 SMSFs in existence ... Read more
What is the sole purpose test, and how does it work?
All super funds must satisfy the sole purpose test to be eligible to receive the tax concessions available under Australian superannuation legislation. Super contributions and earnings are generally taxed at the concessional rate of 15% in Australia (up to certain contribution limits). What is the meaning of the sole ... Read more