SMSFs can be a great investment vehicle for those prepared to get the compliance side of things right. The ATO takes SMSF regulation seriously and has now revealed the top three contraventions it sees among SMSFs. This is a helpful insight into the areas that are frequently tripping up SMSF trustees. The ATO says it…

Recent changes to the law mean many more Australians can now claim deductions for their personal superannuation contributions. But while the eligibility requirements have been lowered, the process for claiming deductions is not straightforward. Do you know what steps to take and what to look out for? Provided you are eligible, superannuation contributions you make…

Did you know that SMSFs may soon be able to have up to six members? The government’s proposal to increase the current maximum of four members will increase flexibility by allowing more members to pool their superannuation savings within one fund and may offer considerable investment, cashflow and tax advantages. However, the plan also throws…

Certain superannuation thresholds are set for a small boost from 1 July 2019 thanks to the latest indexation factors published by the Bureau of Statistics. While the concessional and non-concessional contribution caps are unchanged, the capital gains tax (CGT) cap amount and the employment termination payment (ETP) cap will both increase. This is welcome news…

Among the key investment rules that SMSF trustees must be familiar with are the laws restricting “non-arm’s length” dealings. In essence, SMSFs are prohibited from dealing with a related party of the fund on uncommercial terms and, where these terms are too favourable to the SMSF, hefty tax penalties can apply. Proposed laws before Parliament…

For many Australians, the control and flexibility offered by an SMSF makes this an attractive option for managing their superannuation. However, being an SMSF trustee carries significant responsibilities. In a case last year (Hart and Commissioner of Taxation), the Administrative Appeals Tribunal underlined the consequences that can flow when SMSF trustees do not take their…

The Productivity Commission’s recent report on Australia’s superannuation system reveals some concerning weaknesses in the APRA-regulated funds sector – particularly for millions of member accounts in “MySuper” default funds. It also identifies three areas of concern for SMSFs. The report should prompt all Australians to assess whether they currently have the right superannuation arrangements in…

Individuals with a total superannuation balance (TSB) below $500,000 are now able to “carry forward” their unused concessional contributions (CC) cap space to future years in order to catch up on contributions later when they have the capacity to do so. Usually, an individual’s CCs are capped at $25,000 per financial year, and exceeding the…

Individuals with income and super contributions above $250,000 are subject to an additional 15% Div 293 tax on their “low tax contributions” (ie concessional contributions). Concessional contributions include all employer contributions, such as the 9.5% super guarantee and salary sacrifice contributions, and personal contributions for which a deduction has been claimed. As a result of…

Many SMSFs have used a “limited recourse borrowing arrangement” (LRBA) as part of a gearing strategy to build members’ retirement savings, allowing the funds to borrow to buy high-value growth assets, typically real estate. However, proposed new laws that seek to count a portion of an SMSF’s loan balance towards some members’ own “total superannuation…

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