SMSF alert: February 2014

With little in the way of new laws, rulings or cases it’s been a quiet month. But the Tax Office and ASIC have made some announcements important to SMSF investors.

SuperStream

The Tax Office has been busily warning SMSF trustees of the upcoming deadline for the SuperStream data and payment standard. SuperStream is a set of Government reforms aimed at reducing the administrative burden of making payments to multiple super funds.

From 1 July this year, all large and medium employers (those with 20 or more employees) must use the new standard for sending contributions to super funds. All super funds, including SMSFs, must receive contributions in the new data standard.

If your employer is subject to the standard, you’ll need your SMSF to be compliant by 1 July in order to receive contributions into the fund.

There’s lots of information (including Q&A’s) on the ATO website. But the key thing for SMSF trustees is checking that their administrator or bank can handle the receipt of payments under the SuperStream standard. Alternatively, Australia Post has announced it will provide a gateway service to SMSF trustees.

It’s expected that, from 1 January 2015, the SuperStream standard will also apply to rollovers into SMSFs (from other funds). We’ll look at the options in more detail in a further article.

Action point: Check with your administrator or bank whether they have a solution and keep an eye out for our future article.

ASIC on hybrids

As have we, ASIC have been concerned that investors in hybrids don’t fully understand the risks. This month they’ve added a section to their Moneysmart website outlining the features and risks of hybrids, and a hybrids quiz.

If you’re investing in hybrids, you should be able to get 100% in this quiz.

Other recent developments

Members may also have an interest in the following:

1. Approved SMSF auditors – The ATO has reminded SMSF trustees that this year they need to check the auditor of their fund is registered as an approved self-managed super fund auditor with ASIC.
    
2. New ATO SMSF administrative penalties regime – The new penalty regime will allow the ATO to apply fines on each trustee of a fund, another factor in favour of a single corporate trustee (see attached article for more details).
    
3. No review of limited recourse borrowing arrangements – In a surprise development, the Government has announced (in a presentation to the recent SPAA conference) that there won’t be any specific review of LRBAs in the SMSF sector.
    
4. New ATO guidance –  The ATO has published new guidance on the following topics:

• Accessing your super
• Laws, rules and consequences
• Ownership and protection of assets
• Record-keeping requirements
• Restrictions on investments

Note: Liam Shorte is an SMSF Specialist Advisor™ with Verante Financial Planning and author of The SMSF Coach.