self-managed SUPER funds
Having a self-managed super fund (SMSF) is a great way to save for your retirement.
The difference between an SMSF and other types of funds is that generally, the members of an SMSF are also the trustees. This means the members of the SMSF run it for their own benefit. The Australian Taxation Office (ATO) is the regulator of SMSFs.
JPR Business Group Director Darren Ricardo is fully qualified and licenced as an Authorised Representative under the SMSF Advisers Network Pty Ltd and works with clients to provide advice around the establishment (or closure) of an SMSF, as well as a comprehensive range of strategies when it comes to your super, including making superannuation contributions or moving into pension phase.
The provision of advice relating to SMSFs and superannuation is heavily regulated and requires the adviser to provide this advice in the form of a Statement of Advice (SOA). The provision of Superannuation advice is undertaken through our licensee – SMSF Advisers Network Pty Ltd.
Thinking about a self-managed super fund?
SMSFs are not for everyone. You will need to obtain the appropriate advice before deciding to set up an SMSF. It is a major financial decision and having the right advice is essential – there may be better options for your superannuation savings.
Setting up an SMSF
When you set up an SMSF, you become a trustee of the fund (or a director of a company that is a trustee). In either case, you are responsible for managing the SMSF according to its trust deed and the laws and rules that apply to SMSFs. The key principle is that you run your SMSF for the sole purpose of providing retirement benefits to its members.
Managing your fund’s investments
All of your fund’s investments need to be managed in the best interests of the fund members and in accordance with the law. All SMSF investments must be separate from the personal and business affairs of all members of the fund, including your own.
As the trustee of an SMSF, you can accept money contributions for your members from various sources, but there are some restrictions. These restrictions mostly depend on the member’s age and the contribution caps. Generally, you can’t accept an asset as a contribution from a member, although there are some exceptions.
Reporting, record keeping and administration
As a trustee, you will have a number of administrative obligations. For example, you will need to arrange an annual audit of your fund, keep appropriate records and report to the tax office on the fund’s operation.
Accessing your superannuation
When paying benefits, your SMSF can generally only pay a member’s superannuation when the member reaches their ‘preservation age’ and meets one of the specified conditions of release – for example, they retire. There are very limited circumstances – such as death or a terminal medical condition – where a member’s superannuation can be accessed before this. There are significant penalties for unlawfully releasing superannuation benefits.
Understanding tax and SMSFs
The income of your SMSF is generally taxed at a concessional rate of 15%. To be entitled to this rate, your fund must be a ‘complying fund’ that follows the law and rules for SMSFs.
Want to know more, or have questions about your SMSF? Don’t hesitate to contact us.
JPR SUPER PTY LTD is a Corporate Authorised Representative No. 124 7150
Darren Ricardo is an Authorised Representative No. 124 7151 of SMSF Advisers Network Pty Ltd.
ABN 64 155 907 681 AFSL No. 430062