Many Australians are now looking to become more involved in their superannuation matters. 

SMSFs currently represent about a third of the total superannuation funds and remains the most viable option for people who intend to be more involved in their retirement plans.

Benefits of Superannuation Accounting Services

Some advantages of seeking Superannuation Accounting Services include:

• Investment Choice
• Borrowing Options
• Tax Minimisation
• Tax Control
• Insurance Payment
• Minimising Transaction Costs
• Wealth Transfer
• Asset Protection

Investment Choice

Superannuation accounting helps determine the kind of investments an individual can explore. 

There is access to derivatives to offer downside protection or hedging individual portfolio risks. 

SMSFs are also well suited for small business owners in order to have the business property owned by the SMSF and provided back on a lease basis. 

This approach provides a steady income for SMSFs, secure tenancy, and frees capital for business growth.

Borrowing Options

SMSFs can now borrow funds under the new rules. This provision allows members to buy substantial assets that would otherwise be out of their reach. 

Proper superannuation accounting can determine the amount members can borrow either through recourse loan or general property purchase. 

A member can secure up to 70% in a limited recourse loan excluding costs like legals and stamp duty.

Tax Minimisation

Superannuation funds offer the ability to have a tax free pension as a source of income upon retirement. 

SMSFs offer more flexible structures in terms of contributions, contribution timings, earnings allocation, and reserve implementation for members. 

Trustees and advisors, therefore, can exploit SMSF’s unique flexibility to minimise the overall amount of tax paid by members within the fund. 

In pooled superannuation funds, exceptional circumstances are not considered; the trustees of big superannuation funds make a general decision on behalf of everyone.

Tax Control

Through thorough timing pensions, tilting investments, and structuring, tax can be reduced by targeting franking credits among other strategies for concessional tax treatment. 

Members can further make refund claims to ATO for excess credits.

Insurance Payments

One can apply for a ‘guaranteed renewable’ policy that obligates the insurer to continue coverage as long as the premiums are paid. 

Under group insurance, there is inadequate coverage and the insurer’s terms and conditions can be limited. 

Proper superannuation accounting is essential to help determine the type of cover available. 

Group insurance does not include tailored needs and can be cancelled by the super fund without notice.

Minimising Transaction Costs

SMSF prevents triggering of capital gains tax and other transactions which result from selling down assets when moving to the retirement/pension phase. 

SMSFs facilitate a smooth transition because there is no need to sell shares and other assets that may incur various taxes. 

Individuals retain all investments and can draw down their superannuation balances as income. 

Normally, whenever a property is on sale, brokerage fees, property transfer charges, and other rates are involved which increases capital gains tax.

SMSF’s help to reduce this liability.

Wealth Transfer

The superannuation system has plenty of useful estate planning benefits. 

These benefits provide flexibility and control over members’ estate plan to ensure that funds and investments go to the right people at the right time and with minimal tax involved. 

Unlike in wills, superannuation funds are not subject to contest, and taxable pensions can be left to heirs who can inherit them tax-free.

Asset Protection

The Superannuation environment protects business owners from bankruptcy and litigation issues. 

In the event of business failure, superannuation benefits prohibit creditors from accessing superannuation funds. 

Superannuation funds are intended for retirement use only, meaning that the owner cannot use the balance to help out their struggling business either.

If asset protection is one of the main goals, purchasing assets and property within the SMSF is better than putting those investments under individual names. 

With proper superannuation accounting, one can easily save money on taxes, be able to pass property to their loved ones and explore various borrowing options.

If you are looking to establish a Self Managed Super Fund, or need to have your Self Managed Super Fund audited, then look no further than SMSF Pro.

SMSF Pro has years of expertise in the Self Managed Super Fund arena and is able to conduct quick and independent SMSF audits for a flat fee.

Please call us today on 1300 023 374 or message us through our website https://smsf-auditor.com.au/contact/ for all your Self Managed Super Fund requirements.