Running your own fund can be complex and when doing so you must:
- Carry out the role of trustee or director, which imposes important legal duties on you
- Set and follow an investment strategy that ensures the fund is likely to meet your retirement needs
- Use the money only to provide retirement benefits
- Keep comprehensive records and arrange an annual audit by an approved SMSF auditor.There is no minimum amount required to start your SMSF. More and more people are taking control over their financial future through the use of a SMSF.
There are many benefits to operating an SMSF:-
- Superior Returns. Recent surveys have indicated that on an average, SMSF regularly outperform managed super funds.
- Control. Low, when and where you invest is completely up to you.
- Protection. SMSF has less risk associated with it as you can legally protect your investment from bankruptcy and other legal claims.
- Minimal Taxation. SMSF’s only pay 15% flat tax rate.
Ways to contribute to your SMSF:
While you are in control of your SMSF, the government has outlined specific policies surrounding the terms and conditions of SMSF’s. There are strict rules around who can contribute, how much can be contributed and under what circumstances they can be made.If you are under 65, you can contribute into your SMSF with minimal limitations. Once you are over the age of 65, the rules change. Between the ages of 65 and 75 there are a number of restrictions that become tighter the older you get. Once you reach 75, your SMSF can only accept contributions that are mandated employee contributions.
Here are some ways you can add money to your SMSF:
- Employer Contributions – these are super payments made by your employer.
- Salary Sacrifice contributions – these are payments you make before you pay tax. Instead of receiving money and paying tax on it, it goes straight into your super and you only pay 15%.
- Personal Contributions – if you are self-employed you can make voluntary payments into your SMSF and claim a tax deduction.
- Non Concessional Contributions, also known as ‘after-tax contributions’, include your payments as well as eligible spouse payments (where your spouse makes a payment into your super fund) and personal contributions where you have not claimed a tax deduction.
For more information on SMSF’s please feel free to contact us on the given details.