Deloitte rejects minimum balances for SMSFs
There should be no minimum balance for setting up an SMSF and the government should not be directly concerned about the operating expenses of SMSFs, according to Deloitte.
In its second submission to the Financial System Inquiry, Deloitte said that in spite of concerns about high fixed costs relative to balances for smaller SMSFs, there should not be a minimum balance requirement for setting up an SMSF.
“There are practical difficulties on imposing limitations on the establishment of SMSFs,” Deloitte stated.
“The real issue is the appropriateness of the recommendation by advisers for consumers with lower asset levels to use a SMSF.”
Deloitte also stated that allowing SMSFs to use direct leverage creates competitive non-neutrality in the superannuation system.
“Restoration of the general prohibition on direct leverage of superannuation funds improves competitive neutrality and limits the tax advantages of superannuation to funds that have been saved and not borrowed,” Deloitte stated.
