Life insurance in SMSFs requires special consideration. Quite apart from the extra tax deduction gained from the future service benefit or the impost of extra tax where proceeds are not paid to tax dependants, there is the issue of who pays the premiums. Premiums must be debited to the insured’s account but which account? If the member...
The SMSF Association has just released their review of the Australian Taxation Office’s 2016-17 statistical overview of SMSFs. Given the amount of pre-election SMSF negativity it makes a very exciting read with highlights like; The average SMSF establishment size rose to $521,000 compared with the relatively stable levels of $370,000 in the previous four years –...
The ATO has released an explanatory note Death benefit income streams – meeting minimum pension payment requirements to clarify what is required on death. Unfortunately it is confusing in that it misses a couple of rather important items. Pension minimum requirements in the year of death are only applied to reversionary pensions. Non-reversionary pensions are exempt from...
The ATO have updated the interest rates to be charged for related party limited recourse borrowing loans that seek to comply with the safe harbour provisions. Where the secured asset is real property the rates are; 2019/20 - 5.94% 2018/19 - 5.8% 2017/18 - 5.8% 2016/17 - 5.65% 2015/16 - 5.75% Where the secured assets are listed securities the rate is 2% higher...
Dawson v Dawson [2019] NSWSC 82 confirms several matters that have always seemed self- evident but it’s always great to have a case law example as well. The case confirmed that; When a trustee is appointed pursuant to an enduring power of attorney they are personally appointed. They do not represent the appointor. They act independently in...
Yesterday I contacted all our alliance partners whose pension clients had not yet met their minimum pension requirements. There weren't many and, I expect, there will be none by close of business today. Interestingly, I fielded a number of comments about my post earlier this week, on promissory notes that indicated a need for clarification - so...
There are always those who leave their super contributions to the last minute. As a contribution is not made until it is received by the fund, invariably, some don’t quite make it in time. As June 30 is a Sunday this year there are likely to be even more casualties than usual. A contribution is made by...
The 1 July 2019 changes to life insurance under the Protecting Your Superannuation Package Bill have been largely reported on, but are worth repeating, just to be sure you’ve got the message. In the SMSF context, there are numerous situations where members have rolled in most of their balance from an APRA fund, but not all, as...