Validus Private Wealth Advisors have been providing high level strategic advice on Self Managed Superannuation Funds for well over 10 years.
The assessment, establishment and management of these structures (and their underlying assets), is a core competency of Validus Private Wealth, and an area of increased demand from clients.
More and more Australians are turning to SMSFs in order to take greater control of their superannuation; to have greater transparency in relation to their investments; and in some cases to reduce fees.
At the same time, there are quite specific investment restrictions and management responsibilities that must be adhered to in order to properly manage a SMSF. It is not a decision to be made lightly.
With that said however, in the right situation, SMSFs are a very powerful vehicle for wealth creation and retirement funding. Certainly for those clients who prefer a more direct approach to investment (eg. direct residential property), and have the time to commit to being the Trustee of their own SMSF, it is something well worth considering.
Of course, anyone considering the establishment of a SMSF should firstly seek advice from a licensed professional.
Through its internal expertise and strong advisory network, Validus Private Wealth is able to attend to all aspects of SMSFs, including:
- Advice on Trustee responsibilities; the pros and cons of a SMSF; and whether it is appropriate for you
- The establishment of a SMSF – being the establishment of a Corporate Trustee and Trust Deed for the Fund
- Rollover of existing super into your SMSF
- Advice on the investment of your SMSF monies
- Provision of a defined Investment Strategy for the SMSF as required by law
- Establishment of personal insurances within the SMSF if required
- Advice on specific investment strategies, such as using the relatively new borrowing laws – often for the purchase of direct property
- Expert SMSF estate planning advice – with superannuation monies not automatically forming part of your estate, this is an issue often overlooked and poorly addressed
- Referral to a trusted accounting/tax firm for the annual compliance (accounting/audit) of your SMSF
- A range of ad-hoc technical and other queries.
The main difference between a SMSF and other types of superannuation funds is that the members of a SMSF are also the trustees, or directors of a corporate trustee. So with increased control and flexibility comes a level of responsibility.
Benefits of a SMSF
Control – The fund assets are controlled by the Trustees who are also the members. The Trustees have responsibility for all decisions.
“Family” Fund - Up to four members of your family can participate in the fund.
Transparency – Often with SMSFs having a more direct investment approach (eg. direct shares, direct property), there is an increased level of transparency as compared with alternatives.
Investment Choice – The Trustees have absolute discretion with respect to the choice and mode of investment. Once again, this is often a driver for clients looking to invest in direct property for example.
Taxation – A SMSF is taxed like any other complying superannuation fund, with income tax being a maximum of 15% and capital gains on assets held for over 12 months being a maximum of 10%. As with other superannuation funds, any income and gains on assets used to fund a pension to a member, are tax free in the fund.
Fees – The self-managed superannuation fund fee structure may deliver substantial savings when compared with other retail superannuation funds.
Flexibility - Trustees have the flexibility to make decisions with respect to changing market movements and options for retirement income streams. SMSFs also typically have far greater estate planning flexibility as compared with alternatives.
Can the fund provide insurance?
Yes, a SMSF can obtain insurance cover for members of the fund. The SMSF pays the cost of the insurance and claims it as a tax deduction, which makes the costs of insurance more tax effective. Note with recent legislation changes this is an area which should be reviewed regularly.