Self-managed super funds topics

SMSF member receiving warning about changes to their reocrds

matthewk — Wed, 26 Feb 2020 03:45:59 GMT

Our SMSF clients have started receiving the following message that provides so little information but has caused alarm for the clients. As a result they call us worried or angry that we or somebody has been making changes to their SMSF without their permission. The email message doesn't tell the SMSF member what has changed or what form has triggered the change. We now have to spend time guessing which of the following might have changed and then report back to the SMSF.

* financial institution account details
* electronic service address (ESA)
* authorised contact
* members.

So far all we can determine is the tax return has been lodged with bank details (not changed) and members balances (not new memebrs).

Why can't the ATO be more informative in their warning messages. They know exactly why they triggered the message. The populated the client name & SMSF details. Why not the reason?

Gold Bullions in SMSF

Jen1 — Wed, 26 Feb 2020 01:55:10 GMT

Hey everyone,

I am just wondering, if a member of the fund invests in gold bullion, as it doesn't fall under the collectables rules, it does not need to be insured. With the valuations however at year end 30 June. Is a confirmation from the trustees sufficient if they confirm no changes in value from prior year financials? Also is it okay for the trustees to store the bullions at their own personal home?

SMSF

Janfra — Tue, 25 Feb 2020 01:12:23 GMT

Can I lend my SMSF money to enable me to purchase a property? Can my employer pay me my super contributions to repay that loan?

Listed shares as contributions

Gmcg — Tue, 25 Feb 2020 00:04:55 GMT

Hello

Just looking for some guidance...

Age 60 and not retired (self employed- low income) with a smsf balance circa $600k.

Have listed shares outside of smsf on ASX value circa $100k with significant cgt payable if sold but have held for longer than 12mths.

I'm looking to transfer said shares directly into smsf (if possible) and to obviously minimise tax payable in the process.

Looking for options here if anyone can help.

With thanks

Graeme

FHSSS - using funds

jesswa — Mon, 24 Feb 2020 07:52:18 GMT

I have requested a release, sent the funds to the ATO and express posted my form back to ATO to conform.

How long until I can expect the funds in my account?

SMSF Investment Strategy update ruling

DJP — Sun, 23 Feb 2020 22:32:29 GMT

Was there a new ruling issued about investment startegy recently or just revised guidelines issued recently.

Treatment of Income Protection payouts in superfund and allocation urgent

Lbhardwaj — Wed, 19 Feb 2020 06:44:50 GMT

Hi There,

I quickly need your help. member of our Superfund received insurance benefits under the income protection claim and need to be allocated under right head.

I believe it would be taxable right at 15% in the super fund.

And also, can you please also describe how the payment will be processed to member under the temporary incapacity, can we make one lump sum payment? .

Please assist asap.

Transfer funds SMSF to Industry Fund

HEE — Tue, 18 Feb 2020 02:08:52 GMT

My wife and I are the sole members of our SMSF.
My wife also has some superannuation in a pre-existing Industry Super Fund account.
We have substantial cash in a SMSF term deposit which is underperforming.
We would like to transfer most of the cash amount into my wife’s industry fund account.
My wife’s equity in our SMSF is substantially more that the amount she wishes to transfer out of the SMSF into her industry fund.
My wife is 64 and I am 69.
Are there any potential problems with doing this and what process is involved?

Can I invest funds (part only) from my SMSF . into an industry super fund ?

Ajhcaldwell — Mon, 17 Feb 2020 06:33:17 GMT

I wish to keep control of my self managed super fund as I have a good share portfloio, a rental property, and additional funds.

The cash and small property fund are returning less than 2%.

I woild like to sell the investment property, and small property fund, combine the return and cash, which would be sizable.

and put the combined amount into an industry super fund.

Is this possible?

Is this a good move.?

I'm over 65 years old and looking for a steady income stream.

Tony C

SMSF Valuation of Foreign Investments

MD1 — Fri, 14 Feb 2020 14:11:42 GMT

Hello,

Our SMSF system calculates foreign transactions based on the RBA rates not the ATO exchange rates.

My question is whether it is ok to use the RBA rate rather than the ATO rate when valuing the investments as at 30 June. I notice the RBA rate for USD as at 30 June 2019 is 0.7013 whereas ATO have 0.7332. This can make quite a difference with high valued investments. Which in turn makes a difference for the Total Super Balance and the minimum pension.

MD1

Making contributions aged 74 and work test

Super_Song99 — Sat, 08 Feb 2020 23:11:35 GMT

(1) My wife is 73 years and she would like to contribute $100,000 (from a property sale) to her fund. But her fund already has $475,000. She satisfies the work test very easily. Can she make this contribution or is there a limit to prevent it?

(2) In my case I am 74 years and made a $100,000 contribution to our SMSF in December, 2019. Again the work test is OK. Can I make another $100,000 contribution in the next financial year (July) before I turn 75 years in August?

rollover from SMSF to industry fund

Super_Song99 — Sat, 08 Feb 2020 01:42:30 GMT

My wife and I have a SMSF and we wish to transfer (rollover) to an Industry Fund. Can this be done bit-by-bit as existing Term Deposits in the SMSF mature? Or must it all be done at once?

In the SMSF we have separate contributions. Does this mean that we each need to open separate new Industry Funds, and if so, how do we determine how much goes into each new fund?

Releasing FHSS and deductions

jesswa — Mon, 03 Feb 2020 06:35:43 GMT

I have put in $28,000 non-concessional voluntary payments (after tax / from salary) over three years and would like to request a release. I have claimed the deductions / will be claiming this year as a tax deduction on my personal tax.

When going through the release process, what do I write in the deductions section? $28,000?

Pension Commutation on 1 July

Lionel11 — Fri, 31 Jan 2020 05:42:12 GMT

I am planning to close our SMSF which is currently in full pension mode. I do all the accounting myself and have the fund audited.

I plan to Commute pensions to Accumulation phase on 1st July 2020 and close the fund during the 20/21 tax year by paying a superannuation lump sum.

My understanding is that the fund needs to make a minimum pension payment of 1/365 of annual amount on this day and prior to making commutation. Is this correct?

The fund would be in Pension phase only for a few hours on the 1st. So for the 20/21 tax year the fund would have 0 days in pension phase and all days in accumulation phase. This would mean there would be no Exempt Current Pension Income and there would not be a requirement for an Actuary Certificate. Is this correct?

Reporting SMSF personal CC contributions in Tax Return

vgleiber — Thu, 30 Jan 2020 23:53:05 GMT

My wife made a personal NCC contribution to our fund of $175,000 and later claimed $24,400 of it as CC.

Tax return created by our accountants correctly reported this figure in Section B (Income), Label R2 (Assesable personal contributions).

But in Section F (Member infotmation) for her there was no label to report it as CC and the whole $175,000 was reported in Label B (Personal contributions).

As a result, on ATO site the whole $175,000 is reported as a bring forward NCC instead of $150,600.

How to resolve?

Can SMSF Claim Input GST Credit on Collectables

manishk1 — Thu, 30 Jan 2020 09:37:07 GMT

Hi,

An smsf made investment in collectables item and paid gst on it. The SMSF is GST registered. Can SMSF claim Input GST credit on collectables items.

Non Concessional contributions

MikeGG — Wed, 29 Jan 2020 04:05:06 GMT

I am 64 years of age, turning 65 on 12th February. It is my intention to make non-concessional contributions totalling $300,000 between 20 January and February 8th this year into my Accumulation A/C.

I understand that this will trigger the 'bring forward rule' given the contributions will be in excess of $100 000. As I understand it, as I was 64 at the commencement of the financial year, and all contributions are made prior to my 65th birthday, I do don't have to satisfy a work test, not even for the next two years given the contributions are all made prior to 12th February, my 65th birthday.

These planned contributions, combined with my capital amounts as at 1st July 2017 (accumulation account balance, pension account balance and defined benefit scheme special value) add up to well less than the $1.6m - Transfer Balance Cap.

(member 2) is 64 years of age, turning 65 on 27th March. Between August and September 2018, she made non-concessional contributions of $200 000 into her Accumulation Account. This activated the 'bring forward rule', limiting her to another $100 000 over the 3 year period.

her 65th birthday is March 27th this year. It is our intention to contribute another $100 000 into her accumulation account prior to her 65th birthday. I assume that she will not have to satisfy a work test given she was 64 at the start of the financial year and the contribution will be made prior to her 65th birthday. Once again she will not be anywhere near breaching her TBC.

Does all the above reflect the current rules to avoid making excess contributions?

Cash in SMSF

RT — Wed, 29 Jan 2020 00:57:12 GMT

Hi, can you please tell me if there's any reason a SMSF can't hold cash as an investment? That is, physical Australian dollars (not collectible coins) stored at a trustee's private residence? The trustees would sign a statutory declaration to confirm the cash is held separately from privately held cash.

Self managed super fund

Carlo — Mon, 27 Jan 2020 22:49:30 GMT

Hi, Just wondering if I’m able to purchase a business such as a pub or restaurant and just lease out the premises as an investment?

Super - lost track but I have no tax file number too

waiinleong — Sun, 26 Jan 2020 23:40:19 GMT

Hi eveyrone,

I need some help. I received a letter from oversea to remind me I have unclaimed Super.

I tried to follow the letter to link myGov to Ato but apparently I cant' do that because I have no tax file number. I am struck and I do not know what to do and I can't contact them directly by email( can't find it ) and I have zone differences in oversea which is not easy to just do phone contact. I would love to find out my lost super , where are they and the history of it too.

Please give me advices... Thank you

First Year NCC Caps & Exceeding $1.6M TSB

Tomo — Sat, 25 Jan 2020 10:16:18 GMT

I am retired over 60 but not 65, Can I make one first year NCC contribution up to the value of the cap which may then cause the the total of [NCC] + [TSB @ 30 June prior F'yr ] > $1.6M . eg. the TSB $1.39M and make a $300K NCC (using the 3 year cap). Noting that the TBA will remain < $1.6M.

(I appreciate that any portion of the cap not used in the first year cannot be used in subsequent years if it is to cause the TSB & the NCC to be valued greater than $1.6M.)

How to account a Joining Bonus offer for an Investment

Jay3 — Fri, 24 Jan 2020 06:00:56 GMT

We invested in a Retirement product with 7-year term from SMSF which gave us a joining bonus. Both members are in Accumulation phase

As an example, say my investment was $170,000, eligible for a bonus of $3,400 and Stamp duty paid was $169. My opening statement shows $173,231. We understand that the stamp duty cannot be claimed as a Deduction as it is on Capital account, but what about the Bonus - do I have to declare as assessable income or not?

LumpSum payments over 60

Tomo — Fri, 24 Jan 2020 03:51:53 GMT

I am over 60 and understand that LS and pension payments from my SMSF are tax free, but do these payments (only made after retiring earlier in the year) effect my taxable income in my first year of retirement?

Self managed super funds

Carlo — Thu, 23 Jan 2020 23:32:58 GMT

Can I create a self managed super fund and purchase a business? Am l able to get a loan with my SMSF to purchase the business?

GST in SMSF

Jay3 — Thu, 23 Jan 2020 10:03:14 GMT

My fund is registered for GST as we do Commercial Renting. Is there any link to ATO site or a note to explain if GST can be claimed on GST Included Tax Invoices received for generating Assessable income. A checklist on what GST can be claimed and which GST cannot be claimed.

Transfer balance cap

YSC — Wed, 22 Jan 2020 05:04:25 GMT

If the cap increases by $36,800 by cap indexation, are we allowed to transfer that amount from the accumulation account to the pension account as long as the balance of the pension account not exceeding the transfer balance cap (1.6m+ any amount of indexation in line with CPI)? I also attached some info below for reference.

https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/Transfer-balance-cap/

Thanks,

Gia

SMSF

stephchamp — Fri, 17 Jan 2020 02:48:46 GMT

If I set up a SMSF with myself as the only member, how many trustees are required by law? Am I allowed to use the fund to purchase a computer which I will require to purchase shares, keep track of investments etc...?

TBC for SMSF

rpd — Thu, 16 Jan 2020 01:28:17 GMT

I have a SMSF with two trustees, does each trustee have a TBC of $1.6m, making a total of $3.2m?

deductions relating to Self Managed Super Fund

MrBlackstock — Sat, 11 Jan 2020 13:06:09 GMT

As the director of the SMSF I spend a fair bit of time researching the share market for good investments. If i was to purchase annual membership in a company that specialises in advising subscribers of share market events, trends, and suggested stock purchases, could I use the SMSF cash to pay for this subscription?

One particular company requires payment via a credit card. If I paid for the annual subscription with my own card, could I then receive a reimbursement from the SMSF I am a director of?

I considered that as the subscription is for investment advice, then using the SMSF to pay for it would appear reasonable?

Any clarification on this would be much appreciated,

Cheers, Mr Blackstock

While I was looking through older posts I came across one asking a very similar question, I followed the suggested link and came across this under:

Investment-related expenses

The exact nature of the investment-related expenses is critical in determining deductibility. Examples of deductible investment related expenses include:

interest expenses
ongoing management fees or retainers paid to investment advisers
costs of servicing and managing an investment portfolio such as bank fees, rental property expenses, brokerage fees
the cost of advice to change the mix of investments, whether by the original or a new investment adviser provided it does not amount to a new financial plan.

If the investment related advice covers other matters, or relates in part to investments that do not produce assessable income, only a proportion of the fee is deductible.

From reading this, especially the highlighted sections, I am seeing that subscription fees relating solely to share portfolio investment suggestions would be deductible. As I am not creating a new financial plan, simply obtaining advice on altering the mix of investments, ie purchase and sale of shares as advised by the subscription, then I am thinking that I can subscribe to a internet based company that specialises in share market advice.

Any thoughts would be much appreciated,

Mr Blackstock

Property through SMSF and questions regarding payment and ownership

aksc — Thu, 09 Jan 2020 02:37:39 GMT

We are in the final stage of purchasing a property through SMSF both wife and I are members.

There is a bank account under the SMSF that has about $75K and there is a remaning $60K that needs to be paid at settlement.

(I have an accountant but he's overseas at the moment, so I can't ask him.)

My question is if I pay the remaining $60K, does that create a problem for me during auditing? Should the money be transferred into the SMSF bank account before the payment is made? If I simply pay off the remaining balance at settlement via my own account, can't I simply show it as contributions at the end of the tax year?

Cheers

Alan

Selling the shares own by SMSF to the member/s at a Market Value

Logical_smsf — Sat, 04 Jan 2020 23:10:34 GMT

We own shares in SMSF via Nabtrade platform & We want to sell one off the holding in the Market, however we wanted rather to sell that stock to one off the members i stead of in the market but at the market value & the SMSF will meet all it’s CGT obligations.
Regardless of selling it to member the funds has decided to sell the shares anyways, so we were wondering why not sell it to member/s as long as it is compliant.
Is this okay under SIS Act & if yes
What is the process & documentation requirement?
Thanks

Non-complying Self manage super fund

YSC — Tue, 31 Dec 2019 05:18:30 GMT

Just wondering if a non-complying SMSF still need to be audited? I can't find anything on the ATO website.

Thanks for any help.

Gia

Trusts Fraud Executor Fraud and siblings (all Directors of Family Company)

JohnDonaldson — Mon, 30 Dec 2019 16:07:48 GMT

My Father passed away in January 2013, the Family Company i am shareholder in is the hoding vechicle for numerous Trusts, mosty SMSF Trusts for the lower tax rate. The Execuor(Appoind Director, denies any Trusts for 7yr and still does) and my siblings(also Directors) hide (concealed all Trusts and Trust Deeds, and stil do) these Trusts and various Trust Deeds (some written when father was very sick) are concealed from me all through Probate and 7 years of contesting the 'Will', in the WA Supreme Court, I have found the Trusts myself, they are liquidating the Family company giving me no disclosure, The ATO Trust Risk Department will not give my complaint a Reference number or reply to any emails that the (Directors, Executor is ATO Registered Agent) have been lodging ammended Trusts Deeds for years, the WA Supreme Court Registrars appear involved (Federal Offence), their lawyers lied in recent (2018) Victorian Federal Court and WA Supreme Court documents there were no Trust Deeds, despite in their attachements they include ASIC Lodgements showing Trust Deed lodgements. The ATO and ASIC will not give me access to the Trust Deeds despite being a shareholder in Family Company ??,

Prior Year adjustments

Pete1066 — Fri, 27 Dec 2019 07:51:06 GMT

I have omitted a tax office liability in a prior year in my SMSF. Do I debit the Beneficiary account and credit tax liability to record this?

It does not seem correct to debit the current year expenses with tax due from an earlier period.

Thank you

unable to reach to ato officer regarding my SMSF telephone interview

pranjalrajput24 — Fri, 20 Dec 2019 06:07:25 GMT

Hello experts,

My tax agent sent me an email stating that I need to call ATO SMSF dept on 132869 and then transfer to 74780 for telephonic interview (regarding setup of my SMSF). However its going to voicemail saying that the peson is away.

Also when calling on 132869, the call goes straight to a human operator, who is usually supportive but doesnt have a clue about where to transfer my call.

If the particular ATO SMSF officer is on leave (or otherwise), can I call another number/officer or have them call me back soon (on any working day).

I am worried that my smsf setup is going to be delayed till next year.

Any help/tips will be greatly appreciated. Thanks.

Non concessional member contributions

Pete1066 — Fri, 20 Dec 2019 03:01:02 GMT

Where are non concessional member contributions shown on the SMSF tax return?

Are they part taxed in the fund?

Same question for Concessional member contributions.

Thanks

SMSF investment

Tanbon — Fri, 13 Dec 2019 00:03:03 GMT

What type of investments are allowed? Ie could you invest in a racehorse syndicate or lease?

Super contributions when retired

NT — Mon, 09 Dec 2019 07:13:22 GMT

Hi there. I am having trouble finding answers to the following.

We have a SMSF and my wife will be 65 on the 1 of August 2020. She is retired and will not be working. She is under the contributions cap of 1.6m and would like to contribute $300,000 using the bring forward rule. Can she do this towards the end of the 2020/2021 year. We are confused as to whether she has to satisfy a work test. She will still be 64 at the start of the year but be 65 when she wishes to make the contribution. All responses appreciated.

Loans on existing dwelling owned by the SMSF

wallyato — Mon, 09 Dec 2019 05:21:46 GMT

Hi All,

I wanted to use an existing unit which is fully owned by the SMSF to purchase another, this will be done by splitting the loan between both.

I am not sure about the rules in regard to this but it is a transaction within the SMSF and will help to grow my fund in value.

I don't want to have to sell and re-purchase the same property then add another as the stamp duty in Vic is a killer and will just drag the fund backwards.

TIA

Property investment under SMSF

RachelKumar — Mon, 09 Dec 2019 02:28:21 GMT

Hi, I am exploring investing in property under SMSF and was wondering if its possible to use the funds to reduce loan on existing rental properties that we have? Is it possible to transfer these properties under the SMSF and use the funds under them?

Commercial property purchase from a related party

Connor2407 — Fri, 06 Dec 2019 06:16:20 GMT

Is there any SISA compliance issues that would preclude an SMSF from purchasing a commercial property from a related party and paying for purchase over a series of payments.

Payments terms that have been suggested are a 30 day settlement period, 20% initial deposit with the remaining 80% paid over the 30 days in 4 payments of 20%. Obviously legal ownership transfer will occur at settlement by which time full payment has been received. Purchase price will be supported by independent valuation.

Appreciate that potential issue may be commerciality of terms, however if terms are detailed in a standard contract of sale (in QLD so REIQ) would this be permissible.

Would appreciate any thoughts.

SMSF tax returs

aussietax — Wed, 04 Dec 2019 04:23:20 GMT

the SMSfund has no income except rollover from other superfund to SMSF, do I need to lodge ITR?

property sale

davidjordan — Sun, 01 Dec 2019 04:15:46 GMT

i purchased 2 commercial strata offices in my SMSF. They had separate title deeds so i had to buy them using 2 contracts and 2 limited recourse loans. I have a buyer for both offices. Do i need 2 contracts to sell or can i use 1 contract?

Transfer balance account reporting via ATO Online Services

MandyZhao — Thu, 28 Nov 2019 01:28:03 GMT

Hi,

We have been experiencing difficulties in lodging transfer balance account report via the ATO Online Services. Whenever we try to save the report, a system error comes up saying that there are technical difficulties and try again later.

We contacted the ATO via tax agent info line a month ago. The issue still has not been solved.

Is there anyone looking at this?

Thanks.

Payment slips

Middletons — Tue, 26 Nov 2019 07:27:24 GMT

We have noticed that you can no longer access payment slips via the new portal. Only a PDF of payment options seems to be available (showing reference # and barcode etc).

The payment slips were quite useful to provide to our client whom have SMSF and Companies as they do not receive a Notice of Assessment to pay from.

Is this something that will be added back in?

can an SMSF build a group home and is it a residential or commercial property?

Max20 — Mon, 25 Nov 2019 23:36:24 GMT

I have friend who has a son with Autism and wants to ensure he is well looked after, he has done some research and the government has a program where they pay providers of supported living group home for autistic adults to live in with round the clock support. he wants to know if his SMSF can build such a home and lease it to the governrment, at an commercial arrangement?

online survey

heysoto — Wed, 27 Nov 2019 05:50:33 GMT

This is really great work.
Thank you for sharing such a good and useful information

Does 10 years of non-lodgement of Annual Returns cause a ACR?

EmmaMunro — Mon, 25 Nov 2019 07:24:56 GMT

Hi All

I'm currently completing 10 years worth of SMSF Audits for a client. I know they have breaches for non lodgement of annual returns over this time but does this count as repeated breaches and cause a Contravention Report to be required?

I can't seem to pinpoint if I just have a lot of Qualified Audit Reports or if I need to go to a Contravention Report as well.

Super - transitional CGT relief

MCQ — Mon, 18 Nov 2019 05:11:23 GMT

Hi,

In relation to the transitional CGT relief I note that the election to reset cost bases for the 2016/17 year had to be made by due date for the income tax return for the 2016/17 year (the due date ended up being extended to 2 July 2018 which was the next business day after 30 June 2018).

The ATO website states the following:

"Making a choice is final

Once you have chosen to apply the CGT relief, the decision is not able to be revoked. If you lodged the 2016-17 SMSF annual return

without making the election, you can amend the return within the time limits to make it. However you cannot amend to reverse the election once it has been made."

https://www.ato.gov.au/Super/Self-managed-super-funds/In-detail/SMSF-investing/Transitional-CGT-relief/?page=9

If you have lodged your 2016/17 return, didn't elect to use the CGT relief, can you now choose to apply the relief by amending the 2016/17 return?

From the quoted paragraph above, it's not clear whether 'within the time limits' means the initial date for lodging the return (ie 2 July 2018) or the timeframe for amending the return (which is 4 years).

Thanks

Guide To What I Can Pay For Directly From SMSF

PP7 — Sun, 10 Nov 2019 00:30:33 GMT

Is there a guide to what costs I can claim direct from my SMSF bank account if it is SMSF related?

For example:

i) Office incidentals like stationary, printer cartdidges, etc.

ii) Subscriptions like Digital Fin Review

iii) Computer leasing costs or even purchase of a new computer

iv) Travel to a finacial advice conference to Guadalajara

I threw that last one knowing that it crosses the line in the sand - but I'm after a guide to that describes that line in the sand.

Searched 20 pages of questions and couldn't find anything.

Thanks.

SABP

Gmcg — Fri, 08 Nov 2019 05:13:18 GMT

I have a smsf and just looking to know if I declare retirement (age 60) and establish a simple account based pension can I continue to buy and sell shares even though the account is now in 'retirement phase' and no longer in 'accumulation phase'.

Hope my question is clear enough to understand what I mean.

Commutation

Brianxin — Thu, 07 Nov 2019 20:46:39 GMT

Hi there,
Is there any CGT issue if transferring some or all of a SMSF’s Pension account’s balance back to an Accumulation account?
Thank you.

Taxable Component negative due to losses in fund

SamP — Wed, 06 Nov 2019 03:25:25 GMT

I have taken on a new client that has been running an SMSF for a few years and the members have not yet rolled their industry fund balances. There have only been a couple of Government Co-contributions received, as well as non-concessional member contributions received by way of member's paying fund expenses. Most years there have been losses, so much so, that the taxable component is now showing as a negative on the member statement. The software the previous accountant was using is BGL.

Is this possible?

Now that the taxable component is zero, should the tax free component not be reduced by the losses?

Sam

Audit implication for Amending SMSF Annual return

Jay3 — Thu, 31 Oct 2019 02:26:05 GMT

Detected an error in member balance on SMSF return 2018. The Unrealised Revaluation of Business Real Property was distributed to member balance instead of being put in an Unrealised Reserve account on the liability side. I am ready with my Amended Tax Return which will lower the Member Balances by this unrealised revaluation amount.

Q: Can I submit this directly without the need to go back to Auditor?

Bank accounts

dafydd — Thu, 31 Oct 2019 01:24:02 GMT

My wife and I have a SMSF called, say, Brecon Super Fund*. We are retired, make no contributions to the fund, and live off the fund investments. We recently changed from us as individual trustees to a corporate trustee called, say, Snowdon P/L*. We still have a number of bank accounts in the super fund name with us as individual trustees. Many institutions won't accept SMSF funds with a corporate trustee, or if they do, the interest offered falls to zero.

The ATO recently sent out a notice headed: Is your SMSF bank account in the name of your fund? in which it stated: Your self-managed super fund (SMSF) needs a bank account in your fund’s name.....

Question: as long as the bank account states Brecon Super Fund* is it OK to leave the funds in the existing bank accounts or must I open new bank accounts in the name of Snowdon P/L* which will penalise our fund by paying no interest. If forced to do so this would seem to conflict with the ATO statement: You need to manage your fund’s investments in the best interests of fund members and in accordance with the law. And you need to separate your fund's investments from the personal and business affairs of fund members, including your own.

I argue that it is in the "best interests of fund members" to leave things as they are: the bank accounts include Brecon Super Fund* and show the super fund's ABN and are separated from matters outside the fund.

Thank you for comments

*not real names

Member lending fund to SMSM

LYNWONG — Wed, 30 Oct 2019 23:48:42 GMT

Hi there I had written this to ATO for advise but ATO never reply after 2 months with numerous calls followed up. ATO just advised that they need specialist to look into it.
The SMSF owes the loan of $200k for the property acquired. The lender never cut the rate despite the RBA cut rate 3 times for the last couple of years. They said that the loan rate is not alliance with RBA rate. On top of that, they simply increased the rate 3 times in less than 18 months. The refinance cost is expensive and never worth to swicth to other lender. I intend to borrow/top up from the bank or financial institution to replace this loan. Somehow, I am not certain if the ATO will treat this as non-concession contribution. I will prepare with proper legal documents for the loan transfer and ensure it is split with my current home loan.

Any idea if this is able to do so and comply with the SMSF borrowing regulations? Much appreciate if any contribution toward this issue.

Lyn

SMSF investments not held in name of Fund

Connor2407 — Wed, 30 Oct 2019 01:17:26 GMT

We have come across a circumstance where a credit union that holds a number of cash accounts and term deposits on behalf of an SMSF has changed the ownership of these investments from the Fund to an individual member.

This was done without Trustee consent and appears to be an error caused by a system upgrade undertaken by the credit union.

The Trustees only discovered after being picked up by the Fund accountant (as the change on paper statements was very subtle).

The questions are:

1.Can the Trustees simply arrange for the accounts to be transferred back to Fund ownership given both members are over 65 (or could this bank error be seen as a benefit payment in specie to the Fund members

2. What should be reported to the ATO in terms of SISA & Regs breaches - Reg 4.09A has been breached given these assets weren't held in the name of the Fund, but are there any other issued to consider

Any assistance would be appreciated.

Former temporary resident claim for lost superannuation

Matteo — Mon, 28 Oct 2019 14:02:22 GMT

Hello community!

I have lived in Australia from November 2011 to late 2017, initially on a working holiday VISA, then on a student visa and finally on a Graduate VISA.

Dyring this time I had an uncountable number of part time jobs, some lasting as short as a few days event and some over 6 months. As I have returned to Europe last year I am now willing to claim my Superannuation funds.

However, how can I? I must have who knows how many different superannuation funds under my name, some dodgy cash-in-hands jobs bosses might not have even paid any super and my ATO account shows only one declared account. I am sure there must be more to it.

How can I retrieve all my super accounts? How can I then merge them into one single fund and how can I finally claim it?

Thank you a lot for your advices.

Cheers

smsf tax returns

FlettSMSF — Thu, 24 Oct 2019 02:00:49 GMT

how can I find out that my return is being actioned by the ATO

Smsf not showing up on slsmf

Aussie — Mon, 21 Oct 2019 09:11:10 GMT

Waiting my smsf show up so super can be rolled over have abn plus tax file number but showing election waiting being processed

Got a smsf have abn plus tax file number been registered since 19 last month but when you look it up

Aussie — Mon, 21 Oct 2019 09:05:46 GMT

Smsf all registered but not showing up on slmf been sitting saying election waiting being processed

Selling real estate to members of a smsf in order to wind up smsf

J_B — Mon, 21 Oct 2019 05:23:18 GMT

Can I transfer my low valued real estate property held in smsf to husband and wife members of smsf in order to wind up smsf. Members have reached retirement age and small smsf is not cost effective to retain. Can it be a paper only contract of sale and not have to exchange funds between entities?

Re-Claiming withholding tax for NZ dividend payer

Ian88 — Fri, 18 Oct 2019 23:28:07 GMT

We currently hold 10,000 shares of Michael Hill International Ltd (MHJ.AX) via our SMSF. The company has a dual-listing in Australia and New Zealand although we bought shares in the Australian listed component.

Earlier this year, a dividend of A$250 was paid out on these shares; however, we only received A$132.67 because of A$117.33 of withholding tax. The statement also indicates that there are no Australian franking credits but NZ$100.39 worth of NZ imputation credits.

Is there any way to reclaim either/both of (1) A$117.33 withholding tax or (2) NZ$100.39 worth of NZ imputation credits for an Australian domiciled SMSF?

Thanks in advance for any help -

Ina

binding death benefit nomination

steve — Thu, 17 Oct 2019 01:10:06 GMT

I am the only member of my self managed super fund. I am there for the only trustee. Do i need a death benefit nomination ? . I presume if i die my super fund will default to my last will and testament.

Invoicing a SMSF

rodakisdion — Wed, 16 Oct 2019 13:37:23 GMT

Do I collect tax when issuing an invoice to a SMSF for a service under my ABN?

SMSF purchase Commercial Residential Accommodation units

ShaneM — Mon, 14 Oct 2019 23:06:06 GMT

Hello - can my SMSF purchase Commercial Residential Accommodation units and lease these units to my Accommodation rental business at market rent? Same as a retail owner renting their store from their SMSF?

SMSF Trustees Residency Requirements

taneshaleigh — Mon, 14 Oct 2019 09:02:15 GMT

When establishing a SMSF, can one individual trustee be an Australian Resident and the 2nd individual trustee reside in NZ who is not an Australian resident?

Superannuation SMSF Transfer Balance Cap

Viv — Wed, 09 Oct 2019 08:00:55 GMT

Hello MarkA,

My reply to you kept bouncing back so here goes again.. plus new question.. Viv

Date: Tue, 8 Oct 2019 12:56:20 +1100
Subject: Re: MarkA mentioned you in ATO Community

Thank you for that helpful response, Mark. I bought it pre- September 1985 so it would be exempt..which is just as well as you cgt on sale now applies.

Was happy to stumble across this community n have another question...about superannuation rules. I know there is a transfer balance cap to amounts above $1.6M. but what if my balance went down due to managed fund loss of capital? Does the TBC apply still to the reduced balance of $1.3M based on what I initially put in? Tnx again for your response and your welcome to the community. Viv.

Caveat on property in a SMSF

Nick338833 — Wed, 09 Oct 2019 04:45:23 GMT

Hi all,

I have a client who owns a property and leases the site to a Tenant. The Tenant is selling the Business. The Incoming Tenant's financier requires a Mortgage over Lease to part act as security for the financier lending money to the Incoming Tenant. For the financier to evidence its interest in the Lease, the financier wants to lodge a caveat over the property.

As the property is in a SMSF, can a caveat be lodged over the property or will this affect my client's fund? What are the consequences or raminifications of the caveat being lodged?

Thanks,

PROCESSING SMSF RETURNS

NERRAD — Wed, 09 Oct 2019 04:12:52 GMT

I forwarded a SMSF return on 25th July this year. After not receiving my refund in three weeks like the two previous years, I forwarded another copy on 18th September. How can I find what the delay is in refunding my Franking Credits as I urgently need the funds for my Pension and have already sold some shares to tide me over.

Arms length

kenjefferies — Tue, 08 Oct 2019 09:55:14 GMT

I live in Brisbane, I have a mortgage on a property in central Queensland Rockhampton that I rent out to unrelated tenants.

Can I sell this property to my SMSF at market value, as from what I have read this would then be at arm's length?

SMSF Forms 35404 and Rollover to SMSF N807462.......I can't access the forms for my set-up of SMSF.

LindsayKing — Tue, 08 Oct 2019 00:26:17 GMT

Having trouble accessing Forms on ATO site.I spoke on the phone to an ATO employee yesterday and he assurred me that it was easy. I have a reference No.35404 to initially direct me at Rollovers. Then another one N807462 which is the form no. I actually need to print off.I can't find a portal that allows me to punch in no.s anywhere on this website.

Help me please as I'm not able to spend all day trying to figure out simple ATO IT jargon and tech questions.Thks

Trustee declarations

JanH — Fri, 04 Oct 2019 01:53:04 GMT

Do the trustees have to use the ATO declaration forms for the trustee consent? Can they use the documents prepared by some lawyers?

Winding up a fund with capped defined benefit pension

sandyaspire2 — Fri, 04 Oct 2019 01:32:39 GMT

Hi there,

My example is if a fund with 2 members, both members have a complying life-expectancy pension (fixed term) of 17 years commenced on 01/07/2003 and will be expired on 01/07/2020. The indexation is 3%.

Unfortunately, the husband A passed away during the 2019/2020 Financial Year. All his member entitlements are passed to his surviving spouse B. Consider the balance of the fund assets is running low and the only member B is nearly 80 years old, is it possible to wind up the fund during the 2019/2020 Financial Year?

My other questions are as below:

Is there any difference if the beneficiary is reversionary or non-reversionary?
In what circumstances a complying life-expectancy pension can be commuted into a lump sum? And how to determine the maximum amount that can be commuted? I have read the SIS. 1.06B and I am a bit confused about it.
What will happen if the DBP expires on 01/07/2020 and has a remaining capital. Does the remaining balance have to sit in a unallocated reserve?
Can the beneficiary B commute the existing complying life-expectancy pensions and start a new Market Linked pension on 30/06/2020 or any dates before that?

Many Thanks!

Working for a business owned by your SMSF

DaddyMac — Wed, 02 Oct 2019 05:20:34 GMT

Is it possible to work for a business that is owned by your own self managed super fund or is the income derived from such work deemed to fail the Sole Purpose Test?

SMSF Diversification requirements

Eslyn — Wed, 02 Oct 2019 00:34:27 GMT

What is SMSF Diversification requirements.

I have one investment property in my SMSF only.

SMSF - Election to be regulated is being processed.

adenjvc — Tue, 01 Oct 2019 06:17:23 GMT

How long does this process take to complete? Lodged Election to be regulated on 10 September website is still displaying the same message "election to be regulated is being processed, please try on or after 25 September" every time we call noone can really give us a direct answer it is really frustrating as my existing superfund is not able to process the rollover... THanks

Smsf

Bcv123 — Mon, 30 Sep 2019 14:41:06 GMT

Can a smsf invest lend money to a third party provided the loan is secured ( eg first mortgage ).
As part of the investment strategy.
A principal and interest loan.

SMSF LRBA Loans Residential Property

GO — Mon, 30 Sep 2019 08:27:18 GMT

Can anyone please explain why the interest rates for these loans are skyrocketing???

SMSF closure

Ives1981 — Sun, 29 Sep 2019 08:37:17 GMT

I have an SMSF under 2 names. No assets in the SMSF.
We have both just opened a Australian Super account - one account for each person. I understand I have to get a final audit on the SMSF and the Accountant will need to send a cheque to Aus super however can I transfer my portion into my new superfund and then the remainder monies the Accountant can do the cheque and audit for?
I don't want to spend a fortune asking them to do it if we can do it ourselves.

Rolling over SMSF pension to Industry fund

NoelW — Fri, 27 Sep 2019 05:43:17 GMT

I have an SMSF in pension phase and wish to roll over the pension account to an Industry fund pension account. My question is, do I have to commute the existing SMSF pension back to an accumulation account before I can roll it over?

I am aware that the initial account in the industry fund will need to be an accumulation account, but then it can be immediately converted to a pension account.

A hypothetical client ignores advise and breachs of the SISact, what to do?

Dio1011 — Thu, 26 Sep 2019 05:15:43 GMT

A hypothetical client ignores advise and takes action which is in breach of the SISact, what would be the logical course of action to take? I am not a lawyer so there will not be a client-lawer privilege. Should I report the action, or is there a way to expose this breach.

Payments from SMSF bank account

aksc — Wed, 25 Sep 2019 21:00:15 GMT

Hello,

I have a recently purchased a unit through SMSF. We also set up a bank account under the SMSF name. And yes, we have an accountant and an auditor to do the statements, balance sheets, audits, etc. It's all set up legally and according to the books.

My question is:

- This is a new unit and in order to rent it, it needs to have blinds installed. Is it ok for me to make the payment from the SMSF bank account?

- Or can I make the payment from my personal account? And then how would the accountant relate this payment to the SMSF?

I'm sure this must have happened to quite a few of you who have superfunds. How do you handle such payments?

Thanks

SMSF

Emmett65 — Thu, 26 Sep 2019 00:58:07 GMT

Dear ATO

My name is Mark Emmett am i am planning if possible to self manage some of my super In partnership with my Brother Anthony Emmett, I am an Australian citizen living over seas working as cabin crew for an airline but I was living in Sydney for 14 years, i fly back in to Australia for a few days every month

My brother is living and working in Sydney and has done for over 15 years so his SMSF is straight forward
Both our super funds are with the Australian super fund Hostplus and I want to take 49% of my accumlicated Hostplus funds and transfer it to the company New Brighton capital who will invest the funds for me and my brothers 51%

* I have a Aussie tax file number
* I have an Australian passport
* I understand I need to get a join ABN number with my brother
* I understand I need to open a joint bank account for the super with my brother
* I understand there will be tax to be paid on this SMSF joint venture

Please can you explain if this is possible and if I have to pay any more tax compared to my brother as I am currently living outside of Australia ? I fly in & out of Sydney every month?
If I satisfy the ATO's SMSF cryteria I will ask New Brighton Capital to move ahead and start the procedure and paperwork required

If you need any more information from me please do not hesitate to contact me or my brother on the below numbers.

SMSF over 65

DBN — Wed, 25 Sep 2019 08:50:50 GMT

Can an SMSF continue buying shares if trustees are fully retired and over 65?

SMSF Trustee

GregOliver — Tue, 24 Sep 2019 17:02:55 GMT

Does entering into a PIA disqualify me as a SMSF trustee? If so, does the disqualification end when the PIA is complete?

SMSF

Emmett65 — Wed, 25 Sep 2019 03:11:02 GMT

Dear ATO

My name is Mark Emmett am i am planning if possible to self manage some of my super In partnership with my Brother Anthony Emmett, I am an Australian citizen living over seas working as cabin crew for an airline but I was living in Sydney for 14 years, i fly back in to Australia for a few days every month

My brother is living and working in Sydney and has done for over 15 years so his SMSF is straight forward
Both our super funds are with the Australian super fund Hostplus and I want to take 49% of my accumlicated Hostplus funds and transfer it to the company New Brighton capital who will invest the funds for me and my brothers 51%

* I have a tax file number
* My Australian passport number
* I understand I need to get a join ABN number with my brother
* I understand I need to open a joint bank account for the super with my brother
* I understand there will be tax to be paid on this SMSF joint venture

Please can you explain if this is possible and if I have to pay any more tax compared to my brother as I am currently living outside of Australia ? I fly in & out of Sydney every month?
If I satisfy the ATO's SMSF cryteria I will ask New Brighton Capital to move ahead and start the procedure and paperwork required

Kind regards

Mark Emmett

SMSF transfer to industry fund

GregMolly — Thu, 19 Sep 2019 04:21:00 GMT

My wife and I are in our late 60's and are in full pension phase in our SMSF. We wish to transfer our super into an industry fund(Australian Super). Our assets are in term deposits only and they mature at different dates but 4 mature in late October and early November. We are not sure of the step by step process and would be grateful for any assistance.

The other 3 term deposits mature in March 2021 as they were invested for 2 years. Could we transfer these in 2021 and then wind up the SMSF? We would then have two super funds going for that period of time.

We don't get a government pension..

thank you

GST on reduced credit acquisitions

JCSMSF — Wed, 18 Sep 2019 04:46:58 GMT

As per ATO, the following are the common reduced credit acquisitions:

Investment management functions
Administrative functions

It is also stated that investment management functions include establishment of a financial plan or investment strategy and its ongoing implementation and execution. Since adviser fees charged to SMSF are mostly for strategic advice on investment diversification and risk management, I think it is correct to treat them as reduced credit acquisitions.

Question: Would other adviser fees such as withdrawal and recontribution strategy and pension establishments be treated as reduced credit acquisitions as well? Please note these were actually implemented.

MyGov And SMSF

Avret — Fri, 13 Sep 2019 04:36:34 GMT

Can anyone please tell me how to enable specific payment and notification features for my linked SMSF account linked in Mygov account? I can see it linked, but I am unable to make/modify PAYG payments; or receive any notification regarding my SMSF via Mygov.

I also have my personal account linked in the same Mygov account, and the above two features sought are made available for my personal account?

Thank you.

Wind up of fund without assets

naismith01 — Thu, 12 Sep 2019 10:43:01 GMT

Was wondering if there was anyway to windup a fund that has no assets and has not lodged for a number of years.

My exemple is a fund that invested in a 30 K unlisted asset that has since gone into liquidation. No other investments and a few bucks in the bank.

As the fund has not lodged since inception in 2014, I am trying to avoid a bunch of accounting fees and ATO levies over the seven years it would require to get the fund to a windup position.

I have heard of a member enforced windup where an ATO form can be used to avoid the normally required year on year lodgements.

Can anyone suggest if this is possible and if so, what is required and all the circumstances it (the form) may be used for?

Converting part funds to SMSF

eyeman — Thu, 12 Sep 2019 04:05:33 GMT

My wife and I are looking at starting a SMSF in order to purchase a commercial property. Is it possible to withdraw part of each of industry funds to create a SMSF?

buying property in super

edie — Tue, 10 Sep 2019 07:09:28 GMT

i have a residential property that i purchased in partnership with my self managed super fund 10 years ago (with a 76/24 split) can i transfer more of the property into my fund at any point

Provision for Downsizing

Keone — Tue, 10 Sep 2019 06:37:35 GMT

I have a client who is 66 and his wife is 60. Together they are the trustee's for their SMSF. The wife owns a home in her name. They are looking to sell the home and contribute $300,000 of the sale to their SMSF through a contribution made by him. I'm inclined to believe that this isnt possible as the home is in her name. Is this correct?

SMSF borrowing to buy commercial property

advgt2 — Sat, 07 Sep 2019 00:21:43 GMT

can my smsf borrow to buy commercial property and lease it to my business?

Investment Strategy Diversification Requirements

i_meyers28 — Thu, 05 Sep 2019 22:01:26 GMT

The ATO website refers to an SMSF holding 90% or more of its funds in one asset or a single class of asset as being a concern for diversification requirements. My question is, within the asset class "shares", where do hybrids like, say, cba perls sit? Do they count as shares or as another class of asset, say debt?

SMSF annual return - Managed fund distributions

Billy11 — Thu, 05 Sep 2019 05:23:35 GMT

In the SMSF annual return where should I include Managed Fund disributions? In Section B Income label 'M' or at the various other labels within Section B accordingly?

SMSF new employment forms

comah888 — Thu, 05 Sep 2019 00:24:34 GMT

I have just begun a new job and I need the appropriate forms to complete and then give to my employer. The standard forms have no sections for my "cash management account" banking, so they can't deposit funds? What forms do I need to complete when starting new employement with a self managed super fund?

Investment Strategy Wording

Lindsay1 — Tue, 03 Sep 2019 02:05:57 GMT

As an SMSF auditor I am required to confirm the exeistance of an investment strategy - that is easy.

What is not so easy is to comment on the degree to which it is acceptable, given the limitations on my legal capacity to give financial opinion/advice without and FA licencing standing.

A large number of trustees I have reported to over many years have been very successful small business operators who have leant from experience to make fair judgement and to understand the consequences of their investment decisions.

Whilst a written investment strategy is seen to be of value, other than being compulsory, to many trustees it reprsents long term guidance, rather than a short term compliance measure. Reference to diversity, liquidity, risk, approved investments, borrowing & life insurance are important reminders.

Setting wide percentage bands for multiple investment classes is bad practice as it becomes meaningless and conveys the wrong message. At the other end of the scale narrow & percentage bands lead to regular breaches at annual balance date.

Over the long term I have expressed an opinion,which I now cannot do, that it is acceptable for trustees to adopt an investment strategy that meets the general guidelines but does not specify minimum/maximum percentages, such as -

"It is considered appropriate that no specific percentage range for each of the above asset classes be adopted and that each asset class be considered on its own an investment merits at the particular time that in investment is proposed to be made having regard always to maintaining an appropriate degree of diversification."

In the extreme this approach can lead to a situation such as the following which I have with one audit -

SMSF owns 5 properties [residential & commercial] with 75 year old members on pension, having disposed of their business interests.

They understand fully that liquidy/cashflow is a major forthcoming issue and they will eventually need to sell a property or cease their pensions.

I privately dissagree with their strategy but accept that they are not breaching their written general style investment strategy.

I am considering that in this rather extreme case that I will ask the trustees to specifically recognise the liquidity/cashflow circumstance in their letter of representation and I will continue to engage with them on their planning.

The key issues arising are -

1 - I consider their is no basis for audit qualification or contravention reporting in this specific example, &

2 - I consider the "general" style investment strategy without investment class min/max percentages is acceptable for many trustees.

I would very much appreciate feedback

Super Rollover

Foram — Mon, 02 Sep 2019 05:34:04 GMT

hi there, what if there is a mistake in rollover benefit statement, total amount is right but the dissection between taxable and tax free is slightly different.. how can I correct my mistake. Do i need to do another rollover statement showing on top that it is an amendment or can i do another rollover statement showing taxable component negative??