SMSF trustees and advisers must be cognisant of several issues this year when lodging their 2016/17 annual returns, the SMSF Association has warned.
The 30 June deadline is ‘red alert’ for SMSFs, with association chief executive John Maroney listing transitional capital gains tax (CGT) relief, the transfer balance account report (TBAR) and reviewing super contributions as issues that should be on their radar as they prepare for the end of this financial year.
“SMSF trustees need to be aware they may have to report a transfer balance cap income stream before 1 July 2018,” Maroney said.
“If a member in retirement phase was receiving an income stream on 30 June 2017 that continued to be paid after that date, this income stream must be reported on the TBAR form before 1 July 2018.”
Events that occur during the 2018 financial year are required to be reported either by 28 October 2018 or annually in the 2017/18 SMSF annual return. This depends on the individual SMSF’s time frame, Maroney said.
He also said trustees have until 2 July to lodge their 2016/17 SMSF annual return, which also means this is the deadline for SMSF trustees to make an election for transitional CGT relief as part of the super changes that took effect on 1 July 2017.
“The CGT relief rules allow funds to reset the cost base of assets affected by the introduction of the transfer balance cap and changes to transition-to-retirement income streams,” he said.
“This is a valuable, one-off opportunity for SMSF members to minimise the impact of the changes on their retirement savings and should not be overlooked.”
Trustees also need to review their contributions to ensure they are within legal limits, given this is the financial year where the lower concessional and non-concessional contribution caps have been in place.
“However, it is also the first year where the ’10 per cent rule’ is removed for personal deductible contributions, meaning all individuals are able to contribute $25,000 in personal contributions and claim a deduction for them rather than only those who were self-employed,” Maroney said.
