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SMSF sector seen as ‘punching bag’

SMSF sector seen as ‘punching bag’

Elyse Perrau
29 May 2014

The SMSF sector is being used as a “punching bag” and is unfairly targeted as a tax-minimisation vehicle for the “mega-rich”, according to one financial services firm.

HLB Mann Judd director of superannuation Andrew Yee said he “can’t see why” SMSFs have been subject to such intense criticism.

“It seems to be a punching bag for when something goes wrong in the economy,” Mr Yee said.

“Things like blaming them for pushing up the property market, and blaming them for investments also just being in income and bank shares and not in other asset classes,” he said.

“I was looking at stats and the latest stat is 3.5 per cent for residential property and commercial is around 11.5-12 per cent. In terms of residential there is no SMSF bubble created by investing in property,” he added.

Mr Yee also mentioned SMSFs are being “zeroed” in on for being a tax minimisation vehicle for the “mega-rich”.

“I think that is quite unfair, even though that is naturally a vehicle that they use. I think it has been unfairly targeted, because SMSFs are not only for the rich and you will find it is for a whole range of people,” he said.

“What I have seen is it’s mainly middle-class. You can see lower to upper middle-class, so it is not all for the mega rich,” he added.

Mr Yee said there are many areas in which high net worth individuals can minimise tax, including trusts – not only SMSFs.

“The point I want to make is SMSFs are not this big beast that needs to be whipped down and criticised,” he said.

SMSF sector seen as ‘punching bag’
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