subscribe to our newsletter
Surprise boost for SMSFs in budget measure

Surprise boost for SMSFs in budget measure

Katarina Taurian
06 May 2016

The long-term effects of the removal of the anti-detriment provision may be positive for the SMSF sector.

On Tuesday night, the government announced that it would remove the “outdated” anti-detriment provision, which is complex and inconsistently applied across superannuation funds.

While some are concerned that this will result in heftier taxes for adult children, SuperConcepts' general manager for technical services and education, Peter Burgess, believes there are considerable positives for the SMSF sector in this repeal.

Mr Burgess said anti-detriment payments has been one of the few areas that an APRA fund has an edge over an SMSF, because it’s considerably easier for a large fund to work through the payment mechanism.

“You’ve got to fund anti-detriment up front,” Mr Burgess told SMSF Adviser. “It’s a lot easier for larger funds which have the capital to do that,” he added.

“In the SMSF world, it’s difficult, in some cases impossible, for an SMSF to pay an anti-detriment payment. In the past some people may have held off moving to a SMSF because of that reason,” he said.

As a result, he believes this budget measure may result in more people setting up SMSFs.

“In the past, some people may have held off on setting up an SMSF, because they didn’t want to lose that anti-detriment benefit,” he said.

Read more:

Budget measure set to hit LRBAs

Emerging markets at risk of 'troublesome' times

Surprise boost for SMSFs in budget measure
smsfadviser logo
join the discussion

Do your clients plan to add additional members to their SMSF if the new six member limit is passed as law?

SUBSCRIBE TO THE
SMSF ADVISER BULLETIN

Get the latest news and opinions delivered to your inbox each morning

In this month's issue:

  • Time wrap
  • The tech bull run
  • From hobby to passion
  • Golden Years
  • An untimely reminder
  • Why change is so difficult
  • Key Strategies for equalising super