Why Financial Advisors Assist In Financial Planning Of Smsf

By Author: Ross Caruso
Total Articles: 1
Comment this article

A Self-managed super fund or SMSF is one that is structured as a superannuation trust for its member or members once they have retired and stopped working. The significant difference between these funds and other super finds is that the members themselves are the trustees.

As a result of this structure, the members or trustees run this fund for their benefit, can decide on investments and are responsible for seeing that the fund complies with all laws that govern SMSFs. This can prove quite tricky to non-specialists, and that is why it is best that they take the services of an experienced and knowledgeable financial advisor who can guide them through the process of setting up the fund and managing its administration. This advisor can also come up with investment strategies and insurance products that can apply to the funds in the SMSF. These funds also need to be regularly audited by approved auditors. Annual returns of the find have to be filed, and the necessary taxes paid.

Every member of the fund has to be a trustee, and every trustee has to be a member. The members cannot be employees of other members unless they are related. In the case of single-member funds, only one trustee will be a member, while the other trustee fulfills the need for the minimum of two trustees in a fund. Trustees cannot be paid for their services. It is essential that all assets in the fund have to be in the name of the fund, and care has to be taken to see that they are not combined with any personal assets. Financial accounts must be regularly prepared and submitted, and any breach of laws can result in the trustees having to pay fines individually. If there are any changes in trustees, due to death or other reasons, the fund cannot operate without a proper succession plan.

Trustees to an SMSF have to be eligible to become trustees and have to give consent in writing and declarations stating that they understand their responsibilities and duties. Persons who have been convicted of any offence that involves dishonesty cannot become trustees or if they have been disqualified for any other reason. An SMSF must have sufficient funds to cover the costs that are required to administer it, and still provide substantial benefits to its members. It is also possible to buy property through an SMSF if you follow the rules laid down in this regard.

Providing Financial Advice To Make Australia a Weathier Place. Find more information at Wealth & Retirement Solutions Brisbane