Masterclass SMSF – What’s involved in a self-managed super fund? What are they?

 

Masterclass SMSF - What’s involved in a self-managed super fund? What are they?

SMSF – What’s involved in a self-managed super fund? What are they?

Self-Managed Super Funds (SMSF or DIY Super) are the biggest sector of superannuation savings in Australia See ATO (use this link if it drops off the words https://www.ato.gov.au/Media-centre/Media-releases/SMSF-industry-continues-to-grow/). So what is involved in a self-managed super fund, and what are they?

Superannuation is a long term savings arrangement which is preparation for having money to live on in retirement, and is part of the government’s plan to ensure adequate retirement income. Employers, self-employed, employees and family members (on behalf of others) can make contributions to a super fund.

Contributions can be paid to either –

  • Independent large super funds such as retail, industry, bank and financial institutions (Regulated by APRA – Australian Prudential Regulatory Authority)
  • Retirement Savings Accounts (RSA) banks, institutions (rare)
  • Your own self-managed super fund (SMSF) where you manage it.

Under Australian superannuation law, you have the ability to choose to contribute your superannuation contributions (and in many cases, direct your employer to pay employer contributions) to a superannuation fund of your choice. All super funds are trusts, as your money is held in trust until you are eligible by law to access it to fund retirement.

Note – The Australian Tax Office regulates SMSFs and has several publications, all about super and SMSF.

What is a Self-Managed Superannuation Fund (SMSF)

An SMSF works like all other super funds, which all have trustees, but the responsibility of managing it rests solely on you as the trustee, as well as being the member/beneficiary. Like all superannuation funds, SMSFs invest contributions and provide a benefit to members on retirement.

Generally, a superannuation fund is an SMSF if:

  • It has maximum of four or less members;
  • Each member of the fund is a trustee (or a director of the corporate trustee if used instead);
  • Each trustee or director of a corporate trustee is a member of the fund;
  • No member of the fund is an employee of another member of the fund, unless they are related parties;
  • No trustee of the fund receives any remuneration for their services as trustee; and
  • The fund has a trust deed document (the rules) that meet the requirements of the Superannuation Industry (Supervision) Act 1993 (SIS Act).

How Does an SMSF Differ from Other Superannuation Funds

The difference between a self-managed superannuation fund and other types of superannuation funds is that members are also trustees, or directors of a corporate trustee. This means they control the investments of the fund, the payment of pensions, income streams or benefits and are ultimately responsible for the ongoing compliance (abiding by the laws) of the fund.

What Different Types of SMSFs are there?

There are two main types of SMSFs, based on structure, that is, whether there will be a corporate (special super company) or individual trustees. Another difference is the number of trustees, single member or multiple, up to four trustees/members.

Corporate Trustee:

  • Four or less members;
  • Each member also a director of the company who is the trustee itself;
  • No member an employee of another member unless related;
  • Corporate trustee, nor any director is paid for services related to the fund.

Individual Trustee:

  • Four or less members;
  • Each member is a trustee;
  • No member an employee of another member unless related;
  • No trustee is paid for services related to the fund.

 

Single Member Funds come in two forms:

  • With corporate trustee, member must be sole director of the corporate trustee, or one of two directors either related or not an employee of each other;
  • Two individual trustees, one a member and the other either related or any other person who does not employ them.

 

To learn more about this and the following topics at one of our seminars –

  1. What’s involved in an SMSF and does it suit you?
  2. I want my business to be my super – can I do this and how?
  3. Should I borrow to buy property for my SMSF?
  4. Can stock market shares be included in the investment mix?

see Seminar page http://wp.me/P1sLJd-f

Get our FREE Expert Guide – Self-Managed Super and You – It has all the info you need to know, with bonus TIPS and CHECKLISTS  to determine if SMSF is for you and what steps are needed to set up, as well as how to get your SMSF set up FREE. It also gives you ALL the Aust Tax Office publications about SMSF (NAT XXXX). Get your copy now – click “Download” top right hand side above. You’ll also get monthly SMSF news, investment teaching and upcoming seminar and workshop briefs! Download your FREE Guide now!

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About SuperBenefitnews

Self-Managed Superannuation Service Providers in Australia. WE do not provide Financial Advice or any other service that requires a legally authorized provider. However, where such advice or service is required we have our ‘Connect Assist’, a SuperBenefit resource we use to connect clients to a Licensed Advisor or other legally authorised service provider. SuperBenefit provides a wholistic SMSF assistance, education and administration service continuum - 1. “assistance” is help of whatsoever nature where our overall SMSF experience and knowledge enables us to provide assistance/help without any legal (or “license”) limitations. 2. “education” involves providing knowledge through teaching, coaching and mentoring about all matters SMSF, including (but not limited to) investment issues such as equities and property, 3. “administration” encompasses all admin aspects of legally required SMSF trustee and member record keeping including (but not limited to) audit and ATO matters. In keeping with our key point that SuperBenefit does not provide Financial Advice, where issues arise from 1, 2, and/or 3 above Indicate a need for a legally authorized provider (such as a Financial Adviser) and the client does not have their own service provider, the client can utilize SuperBenefit’s ‘Connect Assist’ … SuperBenefit, in itself, does not provide Financial Advice, but it does provide the wherewithal for great SMSF service. Call us 0407 361 596, no obligation FREE Connection call to see how we can help you!
This entry was posted in 2 Past Newsletter Topics, Masterclass SMSF, Retirement Planning, Superannuation General and tagged , , . Bookmark the permalink.

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