Money is the main source of stress and worry that has troubled generation after generation. Although we never know what awaits us ahead in life, it certainly gives a sense of security when you have saved for a rainy day. Australia is one step ahead when it comes to providing such security, thanks to the possibility to establish a self-managed super fund that will serve you for saving up money for retirement days. The chance to be a part of a fund in which you get to take matters into your own hands and manage your savings is surely appealing. We can see its effectiveness by the popularity SMSFs have been gaining, and the increasing number of people with their own such superannuation funds.
Though it’s not that enigmatic to understand, it takes thorough knowledge to be able to manage the superannuation. There are rules that have to be complied with to stay on track with the regulations of ATO (Australian Taxation Office). An SMSF can consist of up to four members who are called trustees and they can either be individuals or corporate. As trustees people are obliged to carry out with their legal duties, such as making sure the sole purpose test is met, that is trustees only benefit from the fund savings when they retire and not before. The sole purpose test is breached in cases when some trustees benefit from the fund before their retirement which leads to legal issues and consequences. Depending on the mistakes done, fines can vary from $900 up to $10,800. This is why it’s in the best interest of the members and their SMSF to seek professional help for guidance which can be given by a trustworthy SMSF accountant.
Considering there is plenty to be covered with the management of the superannuation, an SMSF accountant can provide you with accounting, taxation and audit services, all of this of course by protecting the professional relationship you establish. From 1 July this year, laws have become stricter when it comes to advice accountants can give and questions they can answer. Only those accountants who have an AFS (Australian Financial Services) licence that is issued by ASIC (Australian Securities and Investments Commission) so it’s in your best interest to look for reliable professionals, licensed to give you the answer you are looking for.
Once your SMSF is set, you will have to annually fulfil audit requirements, which is also the job of an accountant. Make sure you keep documents related to finances organised, so that the accountant can give you an engagement letter outlining the steps of auditing and ensuring the fund’s finances are in compliance. It’s important that you are aware of everything the accountant does and advises, regarding administration, investment strategies and decisions, because an accountant can’t take over your role as a trustee. Hire a professional to be on the safe side and go through your retirement with no worries.