Potential taxation changes from the government’s tax options green paper and final tax policy were affecting the way product manufacturers constructed new offerings for the SMSF sector, according to BT Investment Management (BTIM).
The firm recently launched a global small-cap fund, a United States mid-cap fund and a European concentrated value fund offshore.
“Domestically, we are still thinking about some ideas and I suppose, as we think about solutions for the SMSF market, these processes tend to be longer in terms of duration because it involves a lot of thought pieces around how you structure it, implications around tax and legal issues as well,” BTIM chief executive Emilio Gonzalez told selfmanagedsuper.
“We have a high bar with these products now, so watch this space.”
Commenting on the impact of potential tax changes to investment managers, Gonzalez said: “When you’re looking at solutions and outcomes, it plays a much bigger input into the design because you’re not only looking at the investment proposition, you’re looking at the after-tax return and different benefits as to how it impacts investors at different tax rates.
“So it’s a much bigger implication in the product design end than simply the investment management side of it.
“It absolutely does play a role into that.”
That was a key reason why BTIM had not released any new products aimed at SMSFs, he said.
“There’s a movement around those aspects that came out in the tax discussion paper that you don’t want to pre-empt – you want to have some firm ground to [stand on] and be comfortable that the settings aren’t going to change in the next two or three months,” he said.
“We are continuing to look at products that target that market which are more outcome-based and it’s fair to say that we’ve got a few ideas in the pipeline to roll it out.
“But it’s got to be the right product. We can’t just go out with another equity product or another fixed income product; you’ve got to offer them something that is different and unique, not something they can simply buy off the shelf anywhere.”
BTIM last week reported its funds under management reached $77.1 billion in the half year to 31 March 2015, an increase of $10.7 billion.
