Given that many small businesses manage their own superannuation through Self-Managed Superannuation Funds (SMSFs), in this edition of the Broadcast we feature articles that address the pros and cons of the Federal Budget’s effect on the SMSFs, as well as the ATO cracking down on SMSF tax scams targeting small business owners, and other emerging issues.
According to a report in The West Australian of 29.7.16: “The 100,000 West Australians who manage their own superannuation have been rocked by research showing half will be hit by the Turnbull Government’s tinkering with nest eggs.”
Conversely, an article in the YOUR MONEY supplement of The West Australian of 1.8.16 says: “Resilient SMSFs still best. Funds with $1.6m-plus balances will barely notice the impact of the cap.”
The article goes on to say: “Self-managed superannuation funds are proving a resilient retirement savings tool, despite fears about the impact of budget changes on the sector.
“Detailed research by SMSF Association and sector experts Accurium, relying on analysis of 65,000 SMSF funds, found the median balance of 65-year-old SMSF couples of $1.1 million was significantly higher than the $702,000 needed to meet the Association of Superannuation Funds of Australia’s comfortable lifestyle yardstick with 80 per cent confidence.
“SMSF Association managing director Andrea Slattery said despite the slight growth in the number of SMSF trustees who would not make the comfortable benchmark grade (up from 25 per cent last year to 30 per cent) and “uncertain and lower yielding” investment markets, the SMSF sector “still provides the best option for people to enjoy a dignified and secure retirement”.
And: “research found the overall impact of the changes was nowhere near as catastrophic as some had been forecasting.”
Also, in an article published by SmartCompany, August 1 2016, ‘ATO cracks down on SMSF tax scams targeting small business owners’, states: “The Australian Taxation Office is cracking down on “pot of gold” tax schemes that use self-managed super funds (SMSFs) to milk profits out of private companies or turn normal income into superannuation.”
“The ATO has lost patience with the practices and set up a project called Super Scheme Smart designed to warn off errant SMSF investors with an education program. ATO assistant commissioner Scott Parkinson told The New Daily “people are being drawn in looking for a pot of gold. But you need to tread cautiously with schemes that seem too good to be true.” The ATO is concerned that older taxpayers are being targeted by promotors.”