Managing your own super fund

A Self Managed Superannuation Fund (SMSF) is a fund where members (who are generally also the trustees), carry out the administrative and investment management of the fund.

As highlighted under our Superannuation Philosophy section, there are many aspects to consider when choosing a superannuation fund. SMSFs are extremely attractive to many clients and offer the greatest flexibility, particularly in the following three important areas of taxation management, investment flexibility, and estate planning and control:

  1. Under the recommended SMSF, taxation liabilities and offsets are determined at an individual member level. In many other types of superannuation, taxation liabilities and offsets are usually spread across the entire fund.
  2. Investment flexibility is much greater in the SMSF option. For example, you can also hold direct shares as well as managed funds and business and residential property.
  3. The SMSF structure provides you with a high level of control in relation to investment management and estate planning associated with these funds.

 

Small Business Owners

SMSFs are particularly suited for Small Business Owners who wish to hold some of their business assets, such as their office or factory, within their superannuation fund. The eventual sale of a business can often yield a large payment that can potentially be tax effectively contributed to superannuation. In this case, a SMSF can be an ideal choice.

 

Executives and Professionals

Executives and Professionals with high surplus cashflow and savings ability may benefit from using a SMSF as part of their long-term retirement savings plan. They are often provided with listed shares in the employer and may benefit from holding some of these company shares within the SMSF structure.

 

Retirees

Retirees with significant levels of investment funds may also consider using a SMSF to manage their retirement funds and pension payments. Control of their investments and ultimate distributions can often be an important consideration and using a SMSF avoids interference by a public trustee.

 

Expatriates

Expatriates should seek expert advice before considering the use of a SMSF as their non-resident tax status may cause complications and potential non-compliance issues with the ATO rules.

 

Strategic Wealth Can Help

The experienced team at Strategic Wealth can help you understand the significant benefits that may arise from using a SMSF and determine whether you should consider adopting this particular superannuation structure.

SMSFs, like other superannuation funds, are subject to stringent rules that must be complied with. The ATO is responsible for supervising compliance with these rules and significant penalties apply to investors who disregard them.

Here are some of the important considerations that apply to the establishment and ongoing management of a SMSF:

  • Selection of a Trustee (Individual or Corporate-type arrangement)
  • Development of a Trust Deed for the fund (the rules of the fund)
  • Development of an Investment Strategy (confirms allowable investments within the fund).
  • Selection of an Administration System (to manage investment and other aspects of the funds required for compliance reporting)
  • Management of the Investment Portfolio (asset allocation and selection of specific assets)
  • Management of contribution and pension payment programs (amounts, frequency etc.)
  • Selection of an Accounting and Audit adviser (manage the ATO compliance requirements on an annual basis).

 

Strategic Wealth can help you implement and manage these aspects on an ongoing basis, resulting in access to the significant benefits associated with a SMSF without the hassles of the administrative duties that must be managed.