SMSF news 1116

SMSF UPDATE

$1.6M ceiling –the proportionate approach must be used to read more <click here>

$200K Super balance – why this is now being used by ASIC, ATO and banks for financing – there is an ASIC RG recommending SMSF’s be formed where balances are $200,000 or more. Whilst this is not legislated in the Corporations Act of 2001, a number of other Authorities are now referencing the same dollar amount, the ATO has stated that this amount should be the minimum for a SMSF to obtain a loan, and some lenders have been talking about changing lending guidelines based on this amount also.

Pension Changes 1Jan17 – This affects two areas – the change in the assets test free threshold and an increase to the taper rate.  Some good news reminders when communicating these changes are that If there are changes to a client’s pension, they will likely be eligible for a low-income care card, and if they’re of retirement age, they will receive the Commonwealth Seniors Health Card.

$100K non concessional cap – industry experts are saying enquiries have doubled on the topic because the $500,000 life time cap to be introduced is confused with the bring forward rule, to understand why <click here>.

Remember this new measure was introduced on 15Sep16 to replace the $500K life time cap introduced in the May 2016 budget, and at present the $100K per annum limit is proposed to be come into effect on 1 July 2017, together with the same 3 year bring forward rule. Also remember to not breach the new measure also introduced into the budget being the $1.6M superannuation balance.

Downward trending market – what can your clients do  to some options: <click here>

SMSF Off the plan property purchases – beware law suits where finance not approved! I recently read an article that whilst it applies to SMSF Trustees, it also applies to any person entering into an unconditional contract to buy property. Be careful to remind clients of the DANGER that whilst a finance approval might be granted at the time of the contract being entered into, by the time settlement occurs and finance is needed, many finance applications must be approved again and where not successful an the SMSF cannot settle, the seller of the apartment could sue the Trustee for damages, or any other remedy for non-performance of the contract. For more on off the plan purchases <click here>.