As part of your SMSF strategies it is essential to complete thorough year end planning. Here are just 5 of the key issues that SMSFs need to address before 30 June this year.
1. Off Market Share Transfers
An off market share transfer is where you wish to transfer investments from your own name into your super – for example, direct shares. The rules relating to off market share transfers are due to change from 1 July 2013, so if you want to consider transferring any assets into super you should act early.
2. Contributions Splitting
You may wish to consider splitting your contributions with your spouse – which can help you to even out your balances. This may be an effective tax management strategy should the recently proposed changes to super go ahead.
3. Insurance Strategy now required
Did you know that you now need to have a documented Insurance Strategy within your SMSF Investment Strategy? In addition, with a change to the rules on cross ownership of policies, it is a critical time to check your SMSF insurance arrangements. (We recently reviewed a client’s insurance strategy and with some tweaking improved the structuring and saved them several thousand dollars a year.)
Reviewing your Investment Strategy is also critical. It’s important from a compliance perspective. And, it’s vital to review and re-balance your assets. We’ve seen significant share market returns in the past 12 months – do you know how your actual asset mix has changed? Do you still have a high proportion of funds in cash? Are your current holdings in line with your documented strategy?
4. Market Valuations
Regulations now require assets to be valued at market value each year. So, you need to ensure that you have re-valued assets such as property and collectables.
5. Corporate Trustee
Experts argue that most SMSFs should have a corporate trustee. Yet over 70 percent of SMSFs have individual trustees. There are tax, administration and risk management benefits provided by a corporate trustee arrangement that are not available to individual trustees. If you would like to know more about the benefits of a corporate trustee and how to make the transition, please contact us.
Like to review your SMSF?
We are reviewing SMSF arrangements for our clients right now. If you would like help – or an objective second opinion – please call (02 9262 6045) or email to arrange a time to discuss.