From July 1st, a number of new rules affecting Self Managed Super Funds (SMSFs) may come into play – some of which are still being decided upon and formalised by the government. If a SMSF is something that you’re considering, it’s important that you’re aware of the changes, so that you can make the best financial decisions possible.
SMSF assets must be valued at “market value”
When determining the value of the assets within the SMSF for the 2012-2013 financial year, and every year going forward, all SMSF assets must be valued at “market value” and not historical value (what you purchased it for). In the case of property – depending on the circumstance – a professional valuation may be required.
Increase in ATO power
The powers of the ATO have been increased to provide it with more enforcement capabilities for small to mild offenses – ensuring that all funds are compliant. Thus it’s important to ensure that you only receive advice from a well-established, expert firm as taking shortcuts could have more repercussions now than ever before.
Tax changes are also set to take effect with additional contribution tax for high income earners (those earning over $300,000) and a concessional contribution tax refund for low income earners. Furthermore, cash flow positions will be affected with the contribution rate increasing in stages from 9% to 12% by 2019.
In addition to these changes there are several others, so it’s important that you talk to a professional should you be looking to take out a SMSF, or to ensure that your existing SMSF is being managed effectively. Feel free to get in touch if you would like to find out more.