Regulation Round ups

louise-biti

Regulation Round-up: Quarter III, 2013

Off-market transfers

Superannuation Laws Amendment (2013 Measures No 1) Bill 2013 

Proposals to ban off-market transfers with a related party have been taken off the table, at least for now. 

The Superannuation Laws Amendment (2013 Measures No 1) Bill 2013 included a proposal to ban off-market related-party transfers from 1 July 2013, but the bill was amended in the House of Representatives to remove this item.

This means clients with SMSFs will be able to continue to transfer shares owned in their own names into an SMSF as an off-market transaction.

SMSF annual return 2013

The 2013 SMSF annual return and instructions have been released. This year, a number of changes have been made to take into account reporting and legislative changes, including the need to:

  • record the SMSF auditor number (section A, item 6),
  • advise whether breaches identified in the audit report have been rectified or not (section A, item 6),
  • pay not only the 2012/13 annual levy, but also half of the 2013/14 levy (section D, item 13),
  • report the value of direct investments that are held under a limited recourse borrowing arrangement at the appropriate label (section H, item 15b), but not include these amounts in any other asset label in section H, and
  • clarify whether a fund holds an in-house asset and the value of these assets (section H, item 15d).

Contribution reporting for rollovers

From 1 July 2013, all contributions received during a year must be reported by the receiving fund in that year’s annual return, even if these amounts are then rolled over to another fund during the year.

This means contributions received will no longer be recorded on the rollover benefits statement.

New ATO publication

NAT 74124

The Australian Taxation Office (ATO) has released a new publication called “Paying benefits from a self-managed super fund (NAT 74124)”, which may help clients who have retired or are approaching retirement to understand obligations for lump sum withdrawals and commencement of a pension.

Superannuation rates and thresholds

The rates and thresholds for 2013/14 have been released by the ATO. These can be viewed at www.ato.gov.au using the following trail:  Super Funds > Self-managed super funds – home > Calculators, rates and forms > Rates and codes.

End-of-year review

The start of a new financial year is an opportune time to review a client’s SMSF.

New rules that you should ensure are considered in this year’s review include:

  • Registered SMSF auditor – trustees must ensure the appointed auditor is registered with ASIC. This can be verified by using ASIC connect at www.asicconnect.asic.gov.au.
  • Illegal access penalties – amounts accessed under an illegal early release action will be taxed at 45 per cent. In addition, criminal and civil sanctions can be imposed on promoters of these schemes.
  • Minimum pension payments – account-based pension clients should review the requested pension payments to ensure they meet the minimum payment levels (with the standard pension factors applying in 2013/14).
  • Review investment strategy – by law, investment strategies must be reviewed regularly. While this does not link the review to a specific date, 1 July is a good date to review the strategy to ensure all investments are in line with the current strategy and that it continues to remain appropriate going forward.
  • Consider life insurance – all SMSFs must now ensure they consider life insurance for all members as part of the investment strategy.<
  • Market valuation – all assets should be reviewed for market value as at 30 June 2013 and every year thereafter.
  • Registration of assets – ensure all assets held by the SMSF are registered in the name of the trustee(s) to avoid an $11,000 fine.

Care needs to be taken by SMSF trustees to implement all rules correctly as new penalties apply from 1 July 2013 to give the ATO greater powers. This will include administrative penalties as well as mandatory trustee education.

Copyright © SMS Magazine 2024

ABN 43 564 725 109

Benchmark Media

Site design Red Cloud Digital