In an article for the website Financial Review, Sam Henderson talks about a few mistakes that SMSF trustees must sort out prior to June 30 if they do not want to fall within the radar of ATO’s scrutiny. It is noteworthy that while many SMSFs seek professional help for the management of their fund it is they who are responsible for any compliance breach.
Henderson talks about 7 possible SMSF traps:
- If you have a transition-to-retirement stream of income or draw account based pension, your trust deed may not permit them so it is important to get your deed effectively updated.
- Your investment strategy must be clearly declared and fully updated. In fact, it comes as quite a startling revelation that many SMSF owners have never read their trust deed.
- Keep your Binding Death Nomination in place and fully updated, too. Not doing the same may result in your estate being transferred to hands that you hadn’t originally intended.
- It is important to use your transition to retirement pension unless you have maximized your concessional and non-concessional contributions.
- Draw your pension if you want the best results from the world of “capital gains tax”, “earnings tax” and ‘income tax”. Unless you draw pension your fund gives an impression of being in the accumulation phase and is treated likewise.
- Try refraining from filing your income tax late. If there is some problem with documentation, solve it and if your accountant is the one responsible for the delay, hire another one.
- Those who had been 49 on the last day of June last year can put in $35,000 into their Superannuation and claim deductions for it. This reduces taxable slab and gives strength to your Super.
Keeping small things in mind can be the difference between earning the regard of the ATO or attracting its wrath.
