Self-managed Super Funds are perceived to be DIY in nature, but not all their aspects can be dealt with without professional assistance. When it comes to strategising the tax implications, there are quite a few things the SMSF trustees should be aware of.
Rope in an auditor
Before I begin, it is important to recommend the services of an auditor a good 45 days before the date of lodging annual returns. If, for instance, the date is 31 October, you should hire an auditor somewhere around the second week of September. Also, worth remembering is the SAN or the SMSF Auditor Number. It is a number without which an SMSF trustee cannot lodge a return.
SMSF members may be in the pension or the accumulation phase. If all the members of a specific SMSF are in the pension phase, without maintaining a single reserve account within the fund (example of accumulation phase), then the SMSF is deemed segregated and there is no requirement for an actuarial certificate.
In the contrary case, the funds are not segregated and actuarial certificate can become the foundation for assessing the amount of fund earning exempt from taxes. While segregation is advised in many situations, those SMSF’s exhibiting a combination of accumulation-phase and pension-phase members will vouch that segregation is not often possible because assets can’t be divided, after all.
Investment strategy and insurance
Evaluating the strategy of investment from time to time is crucial for the SMSF members. Checking on investments and insurance is an imperative at least when the annual returns are close by.
Upper contribution caps
Upper ceiling for contribution needs thorough assessment. Are the caps touched till their peak points or can they be utilised further? With some guidance, you can over-contribute in a particular year and throw off the excess amount to a future year. Here, we are talking about analysing ‘reserves’, an appreciable feature for any SMSF environment. If you look at the administration part of the SMSF from the very beginning, you won’t be in a fix when July nears and won’t be forced to make a really big super contribution then.
If there is anything you need an advise on with regards to your SMSF, feel free to get in touch with me. I will be more than glad to assist you.