The ATO, as regulator of self-managed superannuation funds, has reported an increase in the number of SMSF trustees entering into arrangements involving buying and then developing property (either with related or unrelated parties) that is subsequently sold or leased.
The COVID-19 stimulus and relief package also contains measures relating to the instant asset write-off, accelerated depreciation, a cash flow boost for employers, superannuation, stimulus payments to households and much more. Here are more details on each area.
It has been a long time coming, but a planned government amnesty for employers who have missed paying the superannuation guarantee (SG) to their employees has now become law. The amnesty was passed on 6 March 2020, and lasts until 7 September 2020.
When establishing a self managed superannuation fund (SMSF), one central decision to be made early on is if the trustee structure is to consist of individual trustees or a corporate trustee. Between these choices, you can have up to four individual trustees, or one company that acts as trustee (with that incorporated body having up to four directors).
If you own a marine vessel, perhaps a thoroughbred horse or two, have a piece of fine art hanging on a wall, high value motor vehicles in the garage or an aircraft in the shed, it could be time to make sure your tax affairs are in order.
There are very limited circumstances when you can access your superannuation savings earlier than when you meet what the ATO calls a “condition of release” — which for most people generally means achieving a certain age and retiring.
Tax offsets (sometimes referred to as rebates) directly reduce the amount of tax payable on your taxable income. In general, offsets can reduce your tax payable to zero, but on their own they can’t get you a refund.
There are two superannuation-related tax offsets for which you may be eligible. The Australian super income stream tax offset, and a tax offset for super contributions made on behalf of your spouse.
Now and then, taxpayers may find themselves in a situation where they simply have no records to back up a tax claim. There can be many reasons for this, such as losing documents when moving home (either paper or electronic), or technology failures that end up with the same result (or at worst even destroy records).
The majority of people who set up their own SMSF say that “control” is a big reason for doing it. There is flexibility and benefits in running your own superannuation fund, but it is also a big responsibility to make sure your fund grows and provides for your retirement.
Preparing an “investment strategy” is one of the key tasks that SMSF trustees need to complete — and maintain. This involves formulating a strategy that takes into account risk, return and diversification. There is no master plan or prescribed format for preparing an investment strategy, and it will be largely determined by your own approach to investment and risk, and in fact will be unique to your SMSF.
From 1 October 2019, SMSFs that lodge their annual return two weeks after their lodgement due date (for example, 28 February or 15 May) will be suspended from receiving rollovers and employer contributions. The superfund status on the Super Fund Lookup System (SFLU) will change to ‘regulation details removed’. The status will be reinstated to ‘complying’ once all overdue lodgements are up to date.
The latest statistical report from APRA has been released, which of course mainly focuses on the APRA-regulated superannuation funds in the retail and industry sectors.
But the APRA statistics also make passing mention of ATO-regulated funds, the SMSF sector, which from June 2018 to June 2019 grew in total assets from $735.4 billion to $747.6 billion — an increase of $12.2 billion. For a bit of fun, you can think of that equalling roughly $33.4 million each day, $1.4 million each hour, or $23,200 every minute.
Since event-based reporting started for SMSFs from 1 July 2018, the ATO says that for the larger part, SMSF trustees have mostly adjusted to the new requirements.
Now that an entire income year under the transfer balance account report (TBAR) regime has been completed, some teething problems have emerged. A big one for the ATO has been the high number of commutation authorities that have been unnecessarily issued. The ATO says more than 50% of these were revoked due to it consequently receiving amended reporting.
Operating expenses that are incurred by an SMSF are mostly deductible, however there can be exceptions to the extent that these relate to the gaining of non-assessable income (such as exempt current pension income) or are capital in nature.