The SMSF sector has continued to develop and change over the past 12 months. Important developments occurring over this time include the reforms to non-concessional contributions tax, and clarification of a number of important issues around the tax treatment of transition to retirement income streams. In addition, the suggestion of further changes to the superannuation system has been put forward through reports such as the Financial System Inquiry.
Practice Management continues to be in the spotlight, with the expiry of the accountant’s exemption on 1 July 2016. Although only a small number of new limited licenses have been issued by ASIC, it is expected that the new laws will result in significant changes to the scope of services and advice offered by accountants operating in the SMSF space. This overhaul in the advice framework presents significant challenges and opportunities for practitioners.
Structuring within the SMSF environment is an important consideration for many practitioners. Typically, business associates wish to utilise their respective SMSFs to invest through a unit trust to acquire an asset (usually property). Naturally, such investments carry opportunities, but the parties must ensure the SMSF’s investment complies with the superannuation investment rules – particularly the in-house asset rules.
Another area that has seen important developments of late is borrowing within superannuation funds. Following the release of the Financial System Inquiry (which recommended that superannuation borrowing be banned), speculation has swirled around whether the Government will introduce further restrictions around borrowing, or just ban borrowing within funds altogether. Additionally, the ATO has sought to limit the effectiveness of this strategy with its interpretation of the non-arm’s length income provisions as they apply to borrowing arrangements.
Case law continues to develop in superannuation estate planning, with the Queensland decision of Munro v Munro and an appeal heard in the Western Australian decision of Ioppolo v Conti. There is no doubt that case law is currently shaping the approach of ‘best practice’ practitioners to superannuation estate planning. With the added complexity of blended families, coupled with the level of wealth held within the SMSF environment, practitioners have a challenging role to assist their superannuation clients’ transition this wealth to the next of kin.
To learn out more about these areas of superannuation TaxBanter is offering Superannuation Master Classes from early June in 4 locations – Brisbane, Sydney, Melbourne and Perth. These sessions will examine all the latest changes to superannuation and the right super strategies to implement for your clients.
The session runs for 6 hours and covers the following topics:
- Superannuation Update – I’m up to date but do I really know what is happening?
- Practice Management Issues – what drives my successful practice?
- Successful Structuring in Superannuation
- Borrowing in Super – limited recourse or limited life?
- Estate planning – has the dust settled?
To find out more about this training or to register, please click here.
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