Introduction
Being in control of your superannuation can be very rewarding. A Self Managed Super Fund (SMSF) gives you the power to manage your superannuation, investments and retirement. But running your own SMSF is not without its duties. That’s why you need expert assistance. Understanding what you should expect from quality SMSF service providers can help ensure your fund is compliant, efficient and runs smoothly.
Fund Set up and Establishment
First up, quality SMSF service providers provide an efficient fund set-up service. This involves drafting the trust deed, applying for registration with the ATO, applying for an ABN and TFN and establishing a bank account for the SMSF. A good provider takes you through all the stages, makes you understand your obligation as a trustee and makes sure that your fund is put in the right format at the beginning. The initial stage is vital as it can cause compliance problems in the future, especially when it is not set up properly.
Continuing Administration and Records
SMSFs need very detailed record-keeping during the year. Good quality providers will take the administrative load off your hands, including the record-keeping of members and transactions (as well as contributions and rollovers), and minutes of trustee meetings. They keep your records in an auditor-friendly format, so you don’t have to rush to get them in shape for an audit. Good administration is key to a successful fund.
Year-end Financial Reports
Each financial year your SMSF will prepare financial reports. These are prepared by qualified SMSF service providers, in accordance with Australian Accounting Standards (operating statement, statement of financial position and member benefit statements). Having a clear and transparent reporting assists the trustees to know the actual financial position of their fund and make improved decisions in the future.
Tax Return Lodgement
SMSFs are obliged to file an annual return to the ATO. It is a seamless process that is managed by a quality provider who will compute the amount of the fund that is subject to taxation, offer concessional tax rates on contribution and income and file the return before the due date. They also keep an eye on any changes in the law that could impact your tax affairs, so you don’t miss out on any tax concessions or accidentally attract tax penalties.
Independent Audit Coordination
All SMSFs are required to have an annual audit. This process is arranged by the Quality SMSF service providers on your behalf, in collaboration with the approved SMSF auditors and submission of all the necessary documentation. They organise your fund’s records to ensure that the audit is a smooth process and the auditor doesn’t raise any compliance issues. An efficient audit is an indication of an efficient fund.
Investment Strategy Guidance
Trustees must have an investment strategy for the fund that is based on the fund’s purpose and members’ needs. The service providers will assist you to develop, and regularly update, this strategy. Although they may not give personal financial advice (unless they are licensed to do so), they will ensure your strategy complies with the ATO, takes into account the diversification of assets and meets the retirement needs of all members.
Monitoring of Compliance and Regulatory changes
Superannuation law is ever-evolving. Quality SMSF service providers will keep track of regulatory changes by the ATO and ASIC and will keep you informed of any changes which impact your fund. Whether it’s changes to contribution caps, new reporting requirements or pension rules, your provider will keep you up to date and assist you with those changes. Remaining compliant is not a single activity and thus it entails constant watchfulness.
Assistance with Pensions and Benefit Payments
SMSFs can be put into pension phase to offer a tax-effective retirement income. Quality providers can help trustees to set up an account-based pension, compute minimum annual payments of pensions and make sure that the appropriate tax treatment is given. They also assist in the management of lump sum withdrawals and in making the fund comply with its legal requirements in paying the benefits to the members.
Help with Property and other Complex Assets
The high number of SMSF trustees tend to invest in property or unlisted assets or other complex investments. Good service providers are familiar with the special rules on these assets (such as the sole purpose test, related party rules and in-house assets). They can guide you through these rules and complexities without compromising your fund’s compliance. They advise you of pitfalls which can lead to scrutiny by the ATO.
Clear and Fair Fees
Clarity of fees is one of the characteristics of a reliable provider. The quality SMSF service providers are transparent on what services they offer in their packages, which services will be charged extra, and how their prices are in relation to the value they provide. The last thing to do is to avoid those providers whose costs are hidden in small print or whose prices are too low to be true and have unpleasant surprises. Open pricing is indicative of overall professionalism.
Responsive Client Communication
An SMSF is an active investment and decisions may need to be made in a timely way. The right provider communicates in a timely and convenient way – be that by telephone, email or an online portal. You shouldn’t be left waiting for the provider to get back to you. Responsiveness, advice and an assigned contact is an indicator that your provider is as committed as you are to your fund.
Conclusion
The selection of support to be used by your self-managed super fund is not an easy choice. The best SMSF service providers not only ensure compliance, but they become a valuable partner in your retirement savings journey, growing, safeguarding and managing your wealth. Starting with the establishment of the funds, submission of tax, to investment strategy and proactive pension provision, the finest providers present an all-encompassing, clear and active service. Make sure to shop around, ask questions and choose a provider with the experience and values that match your needs.
