Self-Managed Superannuation Fund

Australian government encourages the taxpayers to take responsibility for their financial retirement goals and taxpayers are continually required to deal with the industry superannuation funds.

A self-managed superannuation or most referred to as SMSF, is a way of accumulating savings for retirement which is self-managed by the taxpayer. The benefits of Self-managed superannuation are it allows you to take full control of your investment options and strategy and at the same time reducing tax liability, while obtaining tax benefits and controlled administration cost.

The area of superannuation law is complex and requires careful planning for each individual client. We have highly trained staff who can attend to your unique requirements.

Benefits of SMSF:

• Your retirement plan – An SMSF is your personal retirement plan. It stays with you wherever you go and be personalised to suit your needs and objectives.
• Flexibility and choice – investment flexibility – members manage their investments.
• Greater control – you contribute to controlling your own destiny. You make all the key decisions where your retirement savings are invested.
• Cost – SMSFs can be cost effective compared to other Superannuation products.
• Tax advantages – There are potential tax savings via an SMSF. This will depend upon your personal circumstances and investment choices.
• Satisfaction – people enjoy the accomplishment of seeing their retirement nest egg grow.
• Protection – the assets of your SMSF are protected from bankruptcy and other legal claims

We offer our clients advice on the following:

• Superannuation Audits and Taxation Returns.
• Compliance Matters.
• Taxation Benefits and employer Obligation.

We can assist you with:

• The assessment process – helping determine if an SMSF is the right superannuation solution for you.
• Obtain a statement of advice by engaging a Financial advisor
• Establishment of your SMSF structure.
• SMSF Administration and tax compliance matters
• Complex SMSF issues and investments
• Establish an investment strategy
• Contribution strategies
• Structuring of income streams and pension strategies

Self-Managed Superannuation Fund Investment property (SMSF)

Superannuation Law allows you to borrow to purchase property using a Self-Managed Superannuation Fund (SMSF) structure established for this purpose if certain conditions are met.

The superannuation laws also enable you to borrow and invest directly in any kind of property, including residential and commercial, allowing investors to use property in self-managed superfund to build the wealth.

What are the benefits?

There are distinct benefits associated with using your SMSF to buy an investment property. These include:

• Rental Income from property can be used to help repay the loan.
• Employer superannuation contributions can be used to help repay the loan.
• Members of SMSF can gain access to significant tax efficiencies, only available in the superannuation environment, including
  • No capital gains tax once member(s) retire *
  • Loan repayments can effectively become tax deductible (provided members salary sacrifice)
  • Negative gearing benefits inside SMSF environment.
  • Income after expenses and any capital gains on the disposal of property is taxed at a maximum rate of 15%, compared with rates of up to 47% that a regular investor would be paying.
• Assets held in a SMSF, will be protected against general debt recovery and bankruptcy proceedings under normal circumstances
• SMSF assets are secure as the lender does not have recourse to your SMSF assets in the event of default.
• Buying property may be an excellent way to reduce volatility and overall risk on your investment portfolio

Some things to consider

• Professional advice should be obtained including: A legal, accounting, Financial professional should discuss and establish the structure
• The investment in the property must be in line with the SMSF investment strategy.
• Any loan arrangements may be subject to the provision of personal guarantees, which may expose individual guarantors to potential liability.

Superannuation law is complex and as such, careful management and sound advice are of paramount importance. Investors should obtain legal and accounting advice when considering investing in property using their super or SMSF to fund the property purchase.

At KPA Chartered, we can show you how to obtain maximum benefits from establishment of Self-Management Fund. As part of our Self-Managed superannuation service solution that provides exactly that, creating peace of mind for you now and in the future.

When to consider an SMSF loan

• When you are considering purchasing a property as an investment, but you have:
  • Shortage of equity outside Super; and or
  • Unable to service the loan outside Super
• Taxation benefits:
  • Voluntary contributions
  • CGT considerations
• You hold property outside the superannuation environment that is subject to land tax:
• Land tax thresholds is applicable to SMSF in NSW
• Long term Investment time frame.

We can help you establish a fund to purchase your property. We can explain to you:

• The potential benefits and rules
• Obtain Statement advice by engaging an independent Financial advisor
• How much you need to have in super to be eligible?
• Is the property investment a good idea and is it appropriate for you?
• How to set up and structure the right type of SMSF.