SMSF: Administering and Reporting

As a trustee or director of a Self-Managed Super Fund (SMSF) there are a number of administering and reporting duties that need to be completed.

To start with, no later than 45 days before you need to lodge your SMSF annual return you will need to appoint an approved SMSF auditor to audit your fund.  The auditor should complete the audit of your fund each year.  Their job is to assess the fund’s financial statements and to ensure the fund is compliant with super law.  The auditor must be registered with ASIC and must be independent. This means they should not audit a fund in which they hold financial interest or where the auditor has a close personal or business relationship with any of the fund’s members.

To prepare the SMSF’s statements, annual returns and the fund’s account, you will need to asses the assets of the fund at the market value. Apart from preparing an annual account report you will also need to value assets on the commencement day of a pension as well as during any investment dealings.

An annual return of the SMSF will also need to be lodged once the audit of the SMSF has been finalised.  The SMSF annual return is more than just a tax return. It is also used to report super regulatory information, member contributions as well as pay the SMSF supervisory levy.

In addition to the SMSF annual return report, a separate transfer balance account report will need to be lodged.  This report enables the ATO to record and keep track of a member’s balance for both their transfer balance cap and their total superannuation balances.

You can also use the super transfer balance account report to advise the ATO when a transfer balance account occurs.  It is important to report such events, as the ATO will use the information to adjust the member’s transfer balance account but also apply the correct transfer balance cap arrangements.  This report can also be used for when the ATO requests a member’s total super balance.

As a trustee/director of a SMSF, one of your key responsibilities is to ensure correct and proper record keeping. This includes contribution and tax records.  Good recording keeping will help you manage your fund and prepare accurate statements and accounts.  Moreover, it will assist your SMSF auditor, resulting in lower auditing costs.

Any changes in the fund need to be reported to the ATO within 28 days.  Decisions such as investment changes need to be recorded in meeting minutes. The report must also include why the investment was chosen and whether all trustees agreed with the decision.   Such records need to be kept for a minimum of five years and should be available upon request. Other records such as minutes of trustee meetings, changes of trustees or documentation given to trustees must be kept on record for a minimum of ten years.

Managing a SMSF is a big responsibility.  There are many administrative tasks that need to be performed regularly to ensure the fund is not only performing well but also ATO compliant.  If you are unsure or need assistance with administration duties, consider consulting the ATO website, getting in touch with your SMSF auditor or appointing a licensed SMSF financial planning professional to assist you on an ongoing basis.

LifeTime Financial Group are specialist (holding appropriate accreditations) advisors who are ideally positioned to assist you in managing your SMSF.

Would you like to discuss your personal position further with one of our highly qualified financial planners?

Why not call us today on 03 9596-7733? There is no cost or obligation for our initial conversation/meeting.

Written by Anthony Stedman of LifeTime Financial Group. A leading privately-owned Melbourne based Financial Planning practice.

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