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…

The government has created a new opportunity for some recent retirees to make additional superannuation contributions. From 1 July 2019, a 12-month exemption from the “work test” for newly retired individuals aged between 65 and 74 years with a total superannuation balance below $300,000 means many older Australians will now have an extra year in…

Are you the trustee of one of the approximately 577,000 SMSFs in Australia at the moment? As the SMSF sector continues to grow and the number of funds continue to increase, the workload of the ATO as the regulator increases. Instead of the rigid enforcement of the rules, the ATO has taken an educational and…

Do you have an SMSF and want to grow the assets with borrowings to fund your retirement? An SMSF, or more specifically, the trustees of an SMSF can borrow money but only in very limited circumstances. These include short-term borrowings of 7 or 90 days to cover certain events and more interestingly longer-term borrowings using…

If you’re thinking of setting up your own self-managed super fund (SMSF), to take charge of your retirement and be able to make investment decisions, there are some important steps you have to take before you seek registration with the ATO such as choosing between individual trustees or a corporate trustee, creating the trust and…

ASIC, as co-regulators of SMSF auditors with the ATO, has provided details of its enforcement actions against over 100 SMSF auditors to protect consumers and the integrity of the superannuation system. Whilst the ATO is the one that monitors SMSF auditor compliance, ASIC is regulatory body that investigates any compliance matters that the ATO refers…

During the recent hearings of the Parliamentary Joint Committee on Corporations and Financial Services into ASIC’s oversight functions, the regulator responded to a range of questions regarding SMSF advice and provided policy solutions to be considered by the Committee around reforms to the SMSF sector. According to ASIC report 575 (SMSFs: Improving the quality of…

With the introduction of the transfer balance cap of $1.6m designed to limit the amount of capital that can be transferred into the tax-exempt retirement phase, certain events that track the movement of capital in and out of retirement phase, as well as other events now must be reported to the ATO to ensure the…

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