Peter Burgess, CEO, SMSF Association
SMSF trustees should closely monitor the passage of Division 296 legislation. Even members with balances below the $3 million threshold will need to assess whether any steps are required to reduce or eliminate the future impact of this tax. Members and their advisers will need to act quickly, as they may have less than four months to understand how the revised tax will operate and implement appropriate measures.
Liam Shorte, director, SONAS Wealth
Those with property or other illiquid assets that are hard to value need to understand that auditors will not require much more detail annually. If negotiating with a valuer, especially for commercial property, see if you can do a deal for a full valuation every three years with an update letter on movements/no changes in the intervening two years.
You have always been required to have an up-to-date valuation but the industry norm was to accept a valuation every three years and that has been negated. You need to show proof annually of the valuation of the asset but with good planning you can manage as I have detailed above.
David Busoli, principal, SMSF Alliance
Members with a total superannuation balance around $3 million or more will be considering the impact of Div 296. It would be expected that members with over $10 million will be more likely to remove some of their assets away from the superannuation environment though each case will need to be considered on its merits.
SMSF trustees, generally, will need to ensure their activities are compliant and properly recorded in a timely manner. This has always been a requirement but the regulators are losing patience with those who do not take their responsibilities as seriously as they should.
Meg Heffron, director, Heffron
A better understanding of the things they might do inadvertently when dealing with related parties that could create a NALI/NALE problem for them. I expect there’s still an element of burying our heads in the sand by tax agents, accountants and trustees.
Ever increasing regulatory scrutiny – but I don’t necessarily predict a clamp down, just grumbling. ASIC’s report 824 has been widely (mis) interpreted as a broad statement about SMSF advice being poor across the board.
In fact, it was a targeted review of advice files ASIC expected to be bad. Not surprisingly, they found their risk indicators were sound: they did find a high incidence of advice to be concerned about in a pool where they expected to find it. We should actually be pleased about this – it suggests ASIC is competent in knowing where to look for bad actors. Unfortunately we’ve not heard as much about the fact that ASIC also found a number of the advice files they reviewed indicated good advice and sound recommendations to set up an SMSF.
Naz Randeria, director, Reliance Auditing Services
Over the next 12 months, SMSF trustees should be focusing on stability, clarity, and readiness. That means keeping a close eye on the final shape of Division 296 and understanding how any changes may influence long-term planning, reviewing investment strategies to ensure they remain resilient in a shifting economic and policy environment, and making sure the fund’s documentation, valuations and compliance processes are watertight.
It’s also a good time to deepen your understanding of cash flow needs, contribution strategies, and succession planning, because strong governance and clear structures will matter more than ever in a period where policy uncertainty remains a real factor.
Shelley Banton, director, Super Clarity
SMSF trustees should work proactively with their trusted SMSF professional team to ensure that all fund investments and transactions comply with the SIS and taxation requirements.
Too often, we see trustees make decisions that do not comply with SMSF regulations, only seeking advice from an SMSF professional after the fact. The outcomes of impulsive actions can frequently be sub-optimal, as members risk jeopardising the security of their retirement savings.
Collaborating closely with professional advisers will be key to navigating regulatory and tax challenges, maintaining compliance, and safeguarding the fund against emerging risks over the next year.
Nicholas Ali, head of SMSF technical services, Neo Super
I think SMSF trustees should focus on reviewing their investment strategies and look to diversify their investments to manage economic risk. Also, the regulatory environment still poses risks, with Division 296 still to be finalised. And getting returns lodged as soon as possible, not just for compliance purposes, but to also help with other aspects of retirement benefits, such as contribution planning.
