Masterclass SMSF – EOFY Checklist – 12 Tips to prepare before year end 30 June!

EOFY Checklist – 12 Tips to prepare before year end 30 June!

Now is the time in May to start preparing before year end – here are 12 tips as an EOFY checklist SMSF EOFY.

Ensure all is in order and all essential ACTIONs are taken by 30 June, as well as gathering all documents for all transactions during the year to be ready for the accountant and then auditor verification to meet compliance obligations.

1. Super Contributions in the SMSF bank account – To claim super contributions in this tax year, they need to be DEPOSITED in full as cleared funds – act soon if you want to claim super by 30 June!
2. Contribution Caps (Concessional) – The concessional contribution (tax deductible / employer) caps vary some years for ALL individuals, regardless of age (earlier years were higher). Take care – this year cap is $27,500 ($30,000 from 1 July 2024) and if you have more than one fund, eg SMSF plus commercial, ALL concessional contributions made to ALL your funds are combined together and are counted towards the cap. MORE HERE

3. Minimum Pension taken – For members in the pension phase, they have receive the required minimum pension amount by 30 June. Failure can result in the investment income derived from your assets supporting that pension no longer being exempt from tax and other penalties could apply. MORE HERE

4. Claim Tax Deductions for Personal Contributions (Non-Concessional) – Are you intending to claim a tax deduction for your superannuation contributions? Make sure you are eligible to claim the tax deduction – seek advice if you’re unsure. An error in over-contributing or claiming a tax deduction for personal superannuation contributions could have excess tax due. Any amounts withdrawn under COVID early release can be re-contributed and is NOT counted in the Non-Concessional caps.

5. Off-Market Transfers – If you have shares in your own name, you are eligible to conduct in specie contributions of shares to your fund. Listed stock in your personal name maybe transferred as non-concessional or concessional contributions (if eligible) to your SMSF. Consider the timing taking into account capital gains tax you may incur, contribution caps and the off market transfer procedures.

6. Bring Forward Rule – If you are under the age of 75, you can bring forward up to two years’ worth of non-concessional contributions, in one year, representing your non-concessional (after-tax) cap over a three-year period, subject to total super balance caps. See Here

7. Government Co-Contribution – Take advantage of the Government co-contribution – make a non-concessional (after tax) super contribution before the end of the financial year. For every dollar of eligible contributions, the Government contributes 50 cents up to a maximum government co-contribution of $500. See Co-Contribution

8. Investment Strategy was followed – Revise your investment strategy and ensure all investments have been made in accordance with it, and the strategy aligns with your SMSF trust deed. Also, make sure your investment strategy includes consideration of insurances for members.

9. Valuation of Investments – Annually, assets in your fund must have a current value at 30 June. If you hold unlisted investments such as property or unit trusts, make sure you have evidence of a process of valuing the assets. It is best to have an independent valuation. See the ATO’s “Valuation guidelines for SMSF’s” for further information. 

10. Insurance Policies – Since 1 July 2014, new rules prohibit superannuation fund trustees from offering or holding an “insured benefit” in relation to a member unless the insured event is entirely consistent with a superannuation condition of release. This means that Trauma policies and own occupation Total and Permanent Disability (TPD) policies will not be permitted. However, these new rules will not apply to policies taken out prior to 1 July 2014.

11. In-House Assets – If your fund has in-house assets you must make sure that at all times the market value of these investments is less than 5% of the value of the fund. Do not take this rule lightly as the ATO can apply administrative penalties (fines) for smaller misdemeanors ranging from $820 to $10,200 per breach, per trustee, and the auditor must report any amounts over 5%, plus request rectification in some circumstances.

12. Estate Planning – Consider, what will happen should a member prematurely die – can the fund continue? Are death benefit nominations ready? Are they binding or lapsing? Are the investments able to be quickly cashed? If the fund has life insurance policies, are they appropriate for the member’s needs, and are the policies correctly in the name of the fund? 

What are your Thoughts? Comment below!

SuperBenefit works with SMSF trustees to CONNECT them with the advisors they need for a better result. A call is FREE.

If you have any questions, why not give us a call – it’s FREE! No obligation. 0407 361 596, Paul