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SMSF 30 June checklist: need to know


It is time for self-managed super fund (SMSF) trustees to act now, to ensure their fund complies with the new superannuation rules before they come into force on 1 July 2017.



From that date a raft of new measures announced at this year’s federal budget will apply to super funds. These changes are extensive and complex, so here’s a checklist of steps to consider taking to ensure your fund meets the new rules before the new financial year starts. 

1. Make sure you understand all the changes

The new super regime has numerous new rules with which trustees need to comply. 

So the first step is to ensure you are fully across all the changes and understand their potential to impact your fund. 

2. Lodge your fund’s tax return

Greg Einfeld, director of SMSF specialists Lime Super says now is the time to lodge your 2015/16 annual return, if you haven’t done so already.  

“The deadline has recently been extended from 15 May to 30 June, to provide some additional breathing space,” says Einfeld.  

“But funds that lodge late will have their deadline to lodge their return for the 2015/16 year brought forward to October 2017,” he adds.

To give your SMSF as much leeway as possible to meet the new rules, it’s an idea to lodge your fund’s return on time this year.

3. Assess contributions to your fund

Lower concessional and non-concessional contribution caps take effect from 1 July, and trustees only have until the end of this financial year to take full advantage of the higher caps. 

At the moment people under 50 can contribute $30,000 to their fund on a concessional basis this year and people older than this can contribute up to $35,000 to their fund on a concessional basis. From 1 July this figure is $25,000 for everyone.

Now is the time to assess whether you can contribute up to the full amount and take steps to ensure the funds are inside the SMSF before 30 June.

4. Review new transfer balance cap rules 
 
SMSF members, especially those whose funds are in pension phase, must also ensure they comply with the new $1.6 million transfer balance cap. Under this new provision, super fund members can only hold assets valued up to this amount in their SMSF and receive concessional tax treatment.   

Account-based pensions, complying pensions and annuities within super are included in the $1.6 million cap. Transferring funds from pension to accumulation stage can help trustees ensure they stay under the cap.  

5. Reconsider whether transition to retirement strategies are worthwhile

Transition to retirement pensions won’t be as tax effective in the future. They may still make sense for SMSF members who use them for their intended purpose, which is to continue to contribute to super from a salary while winding down work and at the same time draw a pension to top up income. But for many other people they won’t be as tax-effective as they have been from 1 July. 

“The removal of the tax-exempt status from earnings on fund investments for those using transition to retirement pensions is a change where specialist advice could prove invaluable to trustees,” says Maroney.

6. Look into CGT relief

Now is also the time to create an action plan to work out whether your fund should take advantage of the CGT relief afforded to funds affected by the transfer balance cap and transition to retirement changes.

“The CGT relief rules allow funds to reset the cost base of assets affected by the law changes before the end of the financial year. This is a valuable but one-off opportunity for SMSF members to minimise the impact of the law changes on their retirement savings,” Maroney advises.

The federal government made few changes to superannuation in this year’s budget, giving trustees the opportunity to ensure they are fully compliant with last year’s changes.
 
“Remember, there is only about five weeks to go until the end of the financial year. Getting the right advice now could help trustees to set up their SMSFs in an efficient way for when the new regime takes effect from 1 July,” he adds.
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