Law firms working in the SMSF industry have cited key compliance issues, failing which can levy strict penalties on SMSF members. 1 July and beyond are not going to be as easy days to wade through as have been the days before 30 June. Learn more about the compliance guidelines change that will be implemented after 1 July.
The upper cap on concessional contribution
While the recent budget has softened matters a little, crossing the upper ceiling on contributions can still impose penalties on the relevant members. Keeping this in mind, the employers are also advised to be diligent about the cap of each employee.
Don’t come too close to 1 July in making contributions
Off the note, employers should also remember that the contributions they make to get a tax relief will fetch them the same only if the contributions reflect before the 1st of July. This is especially noteworthy for employers who hire clearing house services. The electronic fund transfer may not pass money so fast after all, and it might be prudent to budget time accordingly.
A word on ‘non-concessional’ cap raise
While talking of the upper cap, the non-concessional contributions also come in mind, with the “bring forward rules” attached to them. For the financial year 2014-15, the non-concessional contribution cap is being enhanced from $150,000 to $180,000. This is great as members can now put in $540,000 for the three-year tenure instead of the upper ceiling of $450,000!
Minimum pension payment
SMSF practitioners need to make certain that the pre-stipulated minimum pension payment is made in regard to each pension received by a member. Not standing up to this requirement can risk the pension exemption for the particular fiscal.
You can contact us at the SMSF hub if you have any queries in regard to the compliance guidelines or if you want to discuss your asset’s diversification strategies.