A Self Managed Super Fund is a type of superannuation account to save for retirement and managed and controlled by the members of the fund. With a limit of up to six members in an SMSF each member gets trustees role. There are some exceptions for single member funds where some other rules apply. Each SMSF member must be superfund trustee or will be the director of the company which acts as trustee of the fund. As a member and trustee of the fund you will be responsible to run the fund according to the rules set by the regulator Australian Taxation Office.
Advantages provided by an SMSF are control where as a member and trustee you have the control where to invest funds money and decide its day-to-day operation by following regulations. Investment choice by obeying the rule of the sole purpose test which means to provide retirement benefits SMSFs can invest in range to assets including property, shares, cash and other allowed by the law. Tax concession which is provided to encourage to save for the retirement the concessional tax rate of 15% apply to the income, concessional contributions, if the asset held for more than 12 months a discount of 1/3rd on capital gain, tax reduction by applying applicable franking credits and in the pension mode tax free. There are rules on how much can be transferred to the pension phase.
To have an SMSF and it’s running you need to devote time and skills and as an SMSF trustee will be responsible for the decisions. You can always take help of SMSF accountants Adelaide in the management and administration of the superfund. All decisions you make in the running of the fund must be in best financial interest of the SMSF members and help of a qualified and licenced professional in setting up an SMSF and its running should be considered. There are compliance risks if the fund not follow the rules and regulations and as a fund trustee you can be personally fined if any breach occurs.
To have an SMSF and its running there are some expenses to pay such as operating expenses, Super levy. Depending on the services you use operating expenses can vary each year. Super levy is paid every year and is paid as part of the annual tax return lodgement.
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