Strategy Matters

SMSF Event Based Reporting

SMSFs have new reporting obligations for transfer balance caps. The transfer balance account report (TBAR) that is used to report certain events is a separate form from the SMSF annual return (SAR). The TBAR enables the ATO to record and track an individual's balance for both their transfer balance cap and total superannuation balance. SMSFs began event-based reporting...

End of Year SMSF Checklist

End of Year SMSF Checklist This check list includes matters that aren’t exclusively End of Financial Year but might be also addressed at this time for the sake of convenience. Some items constitute financial advice so require licensing. Check that concessional contributions have not breached the $25,000 limit. Remember that, if they have, the excess may count...

Total Super Balance

From 1 July 2017, many superannuation obligations and rights became depend on a member’s total super balance which is , broadly, the total amount a person has in all Australian superannuation funds, including amounts in pension phase and accumulation phase. Event Based Reporting Generally, SMSFs are not required to report under the ATO’s transfer balance account report (TBAR)...

Transition to Retirement Pensions

The transition to retirement pension rules allow people who have reached their preservation age to access their superannuation benefits without having to retire or leave their job. This measure allows people to access their superannuation savings by drawing down certain non-commutable superannuation income streams called transition-to-retirement income streams (TRIS). Effective 1 July 2017 the tax-exempt status of...

Penalties

The ATO’s primary focus is to encourage SMSF trustees to comply with the superannuation laws. They deal with SMSF trustees who do not comply with the super laws in various ways depending on how serious the contravention is and the circumstances involved. In some circumstances they may enter into an informal arrangement with a trustee to...

Life Insurance

The existence of a life insurance policy can have unexpected effects. Considerable after tax differences will arise depending on whether tax deductions have, or have not, been taken on the premiums which far outweigh the after tax premium effect. A vital consideration is the application of the future service deduction provisions as well as those for...

Investment Strategy

It is a legal requirement that SMSFs formulate and give effect to an investment Strategy. An Investment Strategy is simply a plan for making, holding and realising Fund Investments that reflects the Fund's Objectives (e.g. increasing the value of members' interests). In establishing an Investment Strategy the following steps should be taken into account. Step 1: Develop...

High Earner’s Tax

Effective from 1 July 2012, Division 293 tax has been charged at 15% of an individual’s taxable concessional contributions above the $300,000 threshold. From 1 July 2017 this limit has been reduced to $250,000, this will affect the 2017/18 financial year income. Individuals will be liable for Division 293 tax if they have taxable contributions for an...

Individual V Corporate Trustees

All Fund assets must be held in the name of the trustee. All the members must be either individual trustees or directors of the corporate trustee. During the life cycle of the Fund new members may join and existing members leave the Fund or become deceased. For an individual trustee Fund this will necessitate changing the...

In Specie Contributions

In specie contributions are contributions to your fund in the form of an asset other than money. Generally you must not intentionally acquire assets (including in specie contributions) from related parties of your fund. However, there are some significant exceptions to this rule, including: listed shares and other securities business real property (land and buildings used wholly and...