Self Managed Super Funds

Today Self Managed Super Funds (SMSF’s) are the fastest growing segment of the superannuation industry. There are currently over 400,000 SMSF’s managed by everyday Australians just like you and these days DIY super is no longer the exclusive province of the wealthy. The costs of setting up and managing your own fund have been driven down by the popularity of this perfectly normal approach to taking responsibility for your financial future.

The major benefits of having your own SMSF are:

• Control - You have control over the investment decisions
• Choice - You can invest in a wider variety of investment options including residential and commercial property, listed shares, instalment warrants, wine and art.
• Leveraged Investments - The ability to use gearing or leverage to accelerate your wealth creation. Recent changes to the legislation have allowed SMSF’s to borrow to buy investments. This strategy allows you to use someone else’s money to increase the value of your investments.
• Reduced Costs - The fees charged by retail funds are usually based on a percentage of your fund. The more you have in super the more it costs you each year. A SMSF costs are based on your accounting and auditing needs. These continue to come down as more demand is created and these services become more common.
• Asset protection – SMSF use a trust structure so the assets are protected from litigation and creditors targeting the trustees.
• Income Tax Concessions - Income of the fund is only taxed at 15%
• Capital Gains Concessions – CGT is reduced to only 10% if asset is sold after 12 months and ZERO if the asset is sold after retirement.

Some things that you can not do with a SMSF are:

• A SMSF can not buy assets from a related party. There is an exception allowed for business assets, listed securities or managed funds. It is possible for a business owner to have their business premises owned by their SMSF and pay rent to the fund.
• A SMSF can not buy or hold assets for personal use. Any asset owned by the SMSF must meet the “sole purpose” test. That means it must the asset must be held solely for the purpose of providing retirement benefits for the members. Fr example a holiday home is not for the sole purpose of the fund and therefore is not allowed.
• You can not access the money in the SMSF for personal use. You must ensure that you keep your personal money and assets separate form the money and assets of the SMSF.
• You can not borrow money from the fund nor can the fund lend money to a relative or any related party even if it’s at a market interest rate. This is the sole purpose test in action.

To set up your own fund please complete the Enquire Now Form and a representative will contact you to discuss your needs or phone 1300 88 48 32. If you would like more information before you make a decision then download our E-book entitled Self Managed Super Funds