SMSF contribution caps limit the amount that can be contributed for a member within a single financial year. The government indexes these caps annually. A member of an SMSF whose total contributions in a single financial year exceed the allowable contribution cap may be liable for additional tax on excess contributions. Fund-capped contributions limit for…
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Ensuring that your SMSF annual return is lodged on time is a critical part of the obligations of an SMSF trustee. The ATO has made an important change starting from 1 October 2019. After that date, if an SMSF annual return is lodged more than two weeks after the lodgement due date and hasn’t requested…
SMSF trustees are responsible for managing their SMSFs and ensuring the funds comply with relevant superannuation regulations. There are few things that are easily ignored by trustees, but those things are the key areas the ATO is focusing on. 1.Travel expenses. As per the superannuation law, the sole purpose of SMSFs is to provide superannuation…
Residency of SMSFs is critical to maintain the benefits of tax concessions. For a SMSF to meet the residency status, three tests must be satisfied: The SMSF must be set up in Australia and holds any asset in Australia; The central management and control of the SMSF must be in Australia; If there are active…
From 1 July 2014, employers with 20 or more employees cannot make superannuation contributions to employees’ super funds by cheque under a new law. The law also requires employers with less than 20 employees to comply after 01 July 2015. However, the law does not apply if the employer is related to your SMSF. As…
In previous years, the government has made a large number of changes to the superannuation law and regulations. But in this year’s budget, only small changes were made which will directly influence the self managed superannuation funds (SMSFs) industry. One of the changes is with regards to accessing superannuation under the terminal illness condition. According…
INVESTMENT STRATEGY OR NOT. Quite often when we audit a fund we discover the fund does not have an Investment Strategy or has failed to update/review that strategy. This failure to have the correct documentation then means that the fund is non complying, a situation no trustee would want. What exactly is involved in having…
As part of the process of operating a SMSF Trustees must know the rules and legislation that administer their fund. Yet many trustees continue to make the same mistakes. The ATO monitor these breaches closely and below are the ATO’s current ten most common compliance errors and the % they make up alongside value of…
LIFE INSURANCE OR NOT FOR MEMBERS. SIS regulations have changed and SMSF trustees are now required to consider the life insurance requirements of the members of the super fund. This requirement now forms part of the Investment Strategy in order to ensure that the fund remains complying. Amended regulation 4.09 (2)(e) states: The trustee of…
As auditors we have seen a growing trend amongst SMSF’s where they have moved away from direct share investment towards property. In 2007 the government relaxed the rules applicable to self managed superannuation funds when it came to borrowing for the acquisition. Prior to 2007 funds were not allowed to borrow. The change in 2007…