Self Managed Super Funds

Danny Mattsson is a SMSF Specialist who has assisted and advised on the establishment and ongoing management of over 100 funds. He has also run his own SMSF for the last 10 years.

The ATO has penalised SMSFs over $300 million in the last 4 years with fines for various misdemeanors, which is why it is extremely important to get the right advice.

Setting up a SMSF for the right reasons

SMSFs are not for everyone and if you do not receive the correct advice you can easily end up with a mess that costs thousands of dollars to fix, or that results in fines or non-complying funds.

Many people come to us wanting to establish a SMSF. Generally they see they are paying too much in fees for their existing superannuation fund.
There are many factors to consider, both positive and negative, when establishing and issuing a fund. These include:

• Amount of superannuation available
• Future contributions expected
• Other assets you own or want to own
• Is borrowing to purchase real estate possible?
• Where do you expect to invest your funds?
• Your administration ability to understand issues as a trustee

Self Managed Superannuation Funds (SMSFs) are a very popular superannuation structure being used by about 380,000 individuals, families and small businesses, and they account for more than 30% of all assets held in the Australian superannuation system.

SMSFs perform the same role as larger funds, by investing contributions and making them available to members on retirement. The main difference is that the members of a SMSF are also the trustees of the fund. They control the investment of their contributions and the payment of their benefits.

As superannuation assets grow, many people seek to gain greater control over the day-to-day management of their superannuation, leading to a rise in the SMSF’s popularity.

A SMSF has a number of unique characteristics. For example:

• A SMSF can have no more than 4 members;
• No member of the fund is an employee of another member of the fund, unless they are related;
• Each member of the fund must be a trustee of the fund, and each trustee must be a member. Where a company is appointed to act as the trustee of a SMSF, each member of the fund must be a director of the trustee company, and each director must be a member;
• No trustee of the fund receives any remuneration for their services as trustee;
• SMSFs are regulated by the Australian Taxation Office (ATO) whereas other types of superannuation funds are regulated by the Australian Prudential Regulatory Authority.

Whilst the trustees of a SMSF must act in accordance with the general laws governing all superannuation funds, a number of concessions apply including the ability of a SMSF to acquire certain assets (particularly listed securities and business real property) directly from members of the fund.

SMSFs offer some very real benefits to members, but they also carry responsibilities and obligations. A CLM Investment Services Pty Ltd authorised representative with SMSF specialisation will assist you in taking control of your superannuation to determine the suitability of a SMSF for your particular circumstances.