Standard Choice Form updated for SuperStream & SMSFs

ATO Superannuation Standard Choice Form - SMSFs & SuperStreamThe ATO has released an updated version of the Standard Choice Form, which includes a new section specifically for SMSFs and allows for SuperStream details to be reported to employers.

The new form includes a specific section for SMSFs, which should reduce some of the confusion by trustees when filling out the standard choice form and they are asked for details not applicable to their SMSF.

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ASIC fines SMSF administrators for misleading statements

ASIC has imposed penalties on two SMSF administrators for ‘false or misleading’ statements, Esuperfund and Your Super Accountant. Esuperfund ASIC imposed a total of $ 30,600 in penalties on SMSF administrator Esuperfund for “false or misleading online advertising”. The three penalties, each for $10,200, relate to statements on the Esuperfund website during… Read More »ASIC fines SMSF administrators for misleading statements

Superannuation system “middle of the pack” internationally

Financial Services Council (FSC)/Deloitte Access Economics - International comparison superannuation systemThe Australian superannuation system has been described as “middle of the pack” in terms of investment returns and fees in an international comparison conducted by Deloitte Access Economics.

Titled Financial performance of Australia’s superannuation products, the report was recently released by the Financial Services Council.

Superannuation Returns

According to the report “Australia’s system appears to be ‘middle of the pack’” compared to overseas pension systems. The analysis included twelve pension systems worldwide and found that “Australia has the third highest returns”.

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FSC calls for national retirement income policy

Financial Services Council (FSC) - retirement income policyJohn Brogden, CEO of the Financial Services Council, has announced that the FSC is going to begin work on a national retirement income policy.

“We must embrace the opportunity and lead the debate on taking superannuation from a world class accumulation scheme to the world’s best retirement system”, said Mr Brogden.

He went on to say that the superannuation system must not only provide an income in retirement to “a majority of Australians”, it must also take “intergenerational pressure off the budget”. If the super system fails to achieve these goals the “system and policy has failed”.

The FSC plans to work with “our members, business leaders, community organisations and others” to develop a policy, called the “National Retirement Outcomes Policy”.

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ATO to continue action against dividend washing

ATO, SMSF dividend washingThe ATO has announced that it is proceeding with action against dividend washing, which the ATO considers to be one of the emerging risks for SMSFs.

Previously the ATO had revealed that in March 2014 3,000 letters had been sent to taxpayers who the ATO suspected of being involved in a dividend washing arrangement. Of these 3,000 original letters approximately 1,300 have “responded by coming forward to make voluntary amendments under which the franking benefits obtained from dividend washing transactions have been removed from their tax returns”.

Now the ATO will be sending letters to 500 of these taxpayers who did not respond to the first letter, along with letters to a further 1,500 based on “updated data analysis” by the ATO. These letters will “ask those taxpayers to self-amend their tax returns in order to reverse franking benefits they may have obtained from dividend washing transactions”.

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$510,000 now required for a ‘comfortable retirement’ says ASFA

ASFA - comfortable retirement, modest retirementNew figures published by the Association of Superannuation Funds of Australia (ASFA) show the cost of retirement has risen, with $510,000 now required to fund a comfortable retirement.

According to ASFA, in the forth quarter of 2013/14 the cost of a ‘comfortable retirement’ rose 0.5%, to $58,128 per year. To fund this would require a superannuation balance of around $510,000 for a couple and $430,000 for singles, based on ASFAs calculations.

To arrive at these figures ASFA has assumed that people “do not retire before qualifying for the Age Pension” and that they will receive at least a part Age Pension.

A large portion of the increase in the cost of retirement was due to the rising costs of medical and hospital services, “which occurred mainly as a result of the increases in private health fund premiums effective from 1 April 2014” said ASFA.

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Government sets out expectations for ATO, ASIC, APRA

Government expectation ATO, ASIC, APRAThe Government has issued a ‘statement of expectations’ to many of the regulatory bodies, including the ATO, ASIC and APRA. These statements outline “the Government’s expectations about the role and responsibilities” of the regulatory bodies.

While acknowledging that the regulatory bodies need to act “independently and objectively”, the Government expects that they will “take into account the Government’s broad policy framework, including its deregulation agenda”.

This includes the expectation the bodies will “look for opportunities to reduce compliance costs for business and the community” to contribute to the Government’s $1 billion “red and green tape reduction target”. They are also expected to make a “major contribution to the deregulation agenda and help to boost productivity”.

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