News

In-house asset rules a “trap” for advisors & trustees, says SPAA

Superannuation, SMSF In-house asset rulesThe superannuation in-house asset rules are a “trap for SMSF advisors, trustees”, according to the SMSF Professionals’ Association of Australia (SPAA).

The in-house asset rules “pose one the biggest pitfalls for SMSF trustees and their professional advisors”, says Graeme Colley, Director, Technical and Professional Standards of SPAA.

Colley refers to the in-house asset rules as “one of the most complex set of investment rules in the SIS legislation”. The rules result in a “significant number of breaches of the legislation”, which exposes “trustees to the dangers of significant penalties, non-compliance of the fund or possible disqualification as a trustee”, said Colley.

Read More »In-house asset rules a “trap” for advisors & trustees, says SPAA

BGL announces Simple Fund 360 now integrates with Xero

BGL Simple Fund 360 integration with XeroBGL Corporate Solutions have announced their software, Simple Fund 360, now integrates with Xero’s cloud accounting software.

According to BGL, this integration will allow users of Simple Fund 360 to “connect directly with Xero and seamlessly import bank transactions”. BGL claims Simple Fund 360 “is the first SMSF administration software provider to enable this type of connectivity”.

“Of the 500 plus firms using Simple Fund 360, we know a large percentage also use Xero. The integration expands the bank data capability of Simple Fund 360 as well as providing clients with a single interface to administer their bank data”, says BGL Managing Director Ron Lesh.

Read More »BGL announces Simple Fund 360 now integrates with Xero

White collar workers “risk running out of money” in retirement

White collar workers "risk running out of money" in retirement, MercerWhite collar workers have a significantly higher life expectancy than average and this needs to be considered as part of retirement planning, according to research by consulting firm Mercer.

“White collar workers should not bet on being average or they risk running out of money before their days do and running into diabolical circumstances in retirement”, though is it also a “serious risk of planning finances, career, retirement, and health, including aged care services”, said Mercer.

Read More »White collar workers “risk running out of money” in retirement

Financial System Inquiry: Brisbane Public Forum

FSI, Financial System Inquiry, Public Forum - BrisbaneThe Financial System Inquiry has been holding public forums, as part of the consultation process following the release of the interim report.

This included one in Brisbane on the 19th of August, with others held in Sydney, Melbourne and Perth.

These events are opportunities for members of the public, who aren’t part of the normal consultation process, to raise their concerns with members of the panel.

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44% of super fund members have multiple accounts, says ATO

ATO - Superannuation members multiple accountsAccording to the ATO 44% of Australian super fund members have more than one superannuation account.

This is one reason why the ATO is taking a “special interest” in multiple super accounts, said ATO Assistant Commissioner John Shepherd in a speech to the Tax Institute National Superannuation Conference.

According to Shepherd the ATO is now using super accounts “matched to a TFN along with matched SMSF accounts to gauge the number of super accounts that individuals hold”. The ATOs statistics show that, approximately:

  • 56% of people have one account
  • 26% of people have two accounts
  • 10% of people have three accounts
  • the remainder have four or more accounts.

Read More »44% of super fund members have multiple accounts, says ATO

Progress on excess non-concessional contributions changes: SPAA

refund excess non-concessional contributions, associated earningsAccording to SPAA progress is being made in the consultation process for the changes to allow for the withdrawal of excess non-concessional contributions.

These changes were announced in the 2014 Federal Budget, and according to the Government statement would mean:

“If an individual chooses this option [withdrawing excess non-concessional contributions], no excess contributions tax will be payable and any related earnings will be taxed at the individual’s marginal tax rate.

Individuals who leave their excess contributions in the fund will continue to be taxed on these contributions at the top marginal rate.”

Though the change is meant to apply from 1 July 2013 the consultation process is still proceeding. According to SPAA the legislation is “being drafted”, and meetings are being held between Treasury and “representatives of the superannuation industry, including the SMSF Professionals’ Association of Australia”.

Read More »Progress on excess non-concessional contributions changes: SPAA

SPAA announces pilot technical mentoring program

SPAA Technical Mentoring ProgramThe SMSF Professionals’ Association of Australia (SPAA) has announced a pilot program of a ‘online technical mentoring program’ for SPAA specialist members.

Once passed the pilot state this new educational program will be available to SPAA members holding either the SMSF Specialist SSA or SSAud designation. However as the service is “over and above the current membership” there will be an additional fee.

According to SPAA the program “will assist in enhancing and raising the standard of professional advice and skills and will give members the opportunity to ask SPAA technical staff for assistance on a range of complex technical issues”.

Read More »SPAA announces pilot technical mentoring program

Report links industry super fund performance with governance

Industry super fund, retail super fund, governance and performance - independent directorsThe fight between industry and retail super funds appears to be moving to a new battleground, this time over the appointment of directors of super funds.

The McKell Institute, an “independent, not-for-profit public policy institute”, has released a report investigating the governance structures of retail and industry super funds, and comparing this to investment returns.

However the real purpose of this report seems to be to build an argument against an increase in the appointment of independent directors to industry super funds.

This comes as the as the federal government moves to increase the number of independent directors on superannuation fund boards, which was the topic of a discussion paper released by the treasury department shortly after the 2013 election.

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ATOs stance on 0% LRBAs reinforced by more private rulings

ATO Private Binding Rulings - 0% LRBAs and non-arm's length incomeThe ATO has issued a number of new Private Binding Rulings with the view that 0% limited recourse borrowing arrangements by SMSFs will result in non-arm’s length income.

In April the ATO surprised some when it issued a Private Binding Ruling (PBR)  that said a 0% LRBA arrangement would result in the income earned from the asset being non-arm’s length income, and so taxed at 45%.

Since then the ATO has issued a number of further rulings with the same finding, indicating that it is a broader view held by the ATO rather than one only applicable to the individual situations of a particular case. Some of these private rulings seem to be for arrangements already in place, perhaps by SMSF trustees concerned that their strategies might not have the desired result?

Read More »ATOs stance on 0% LRBAs reinforced by more private rulings

First SuperStream transactions successfully processed

SuperStreamAccording to the ATO the first successful SuperStream transactions have been successfully processed, which “represents a significant milestone for SuperStream implementation”:

“The transactions were processed during the second week of August 2014 as part of the first group participating in the SuperStream induction process. The experience of this first group highlights the benefits which SuperStream will bring with an end-to-end flow of data and payments from employers to super funds.”

The ATO says that the SuperStream contributions data has been reconciled by the recipients, and that “there are no reported outstanding issues”.

Read More »First SuperStream transactions successfully processed