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Super Q&A

This Month

With term deposits paying 4 per cent and inflation just above 3 per cent, you’re barely keeping up in real terms.

Should I move $6m in super to term deposits to avoid tax?

A term deposit might feel safe as Labor introduces additional tax on high-balance accounts, but do your homework.

Most SMSF don’t need to be registered for GST, but it can pay to do it regardless.

The 5 things you must do if you have a self-managed super fund

Consider who will execute your binding death nomination, sell assets and wind up the SMSF.

October

There is an “estimate my super” calculator on the ATO website.

The easy way to check you’re being paid the right amount of super

The ATO has substantial powers to investigate the underpayment of super and even penalise employers who do the wrong thing.

This new tax is based on your fund’s earnings before the pension tax exemption is applied, and is billed to you personally.

Will my super pension still be tax-free if I have $3 million plus?

The tax-free status of super pensions will not change because Division 296 is levied on individuals whose total super balance exceeds the $3 million and $10 million thresholds.

Your wife can appoint someone she trusts to make director-level decisions about the SMSF.

How to safeguard your SMSF from a dementia diagnosis

Appoint a corporate trustee and finalise a binding death benefit nomination for smoother succession planning when faced with future incapacity, experts advise.

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September

Your wife can decide whether to take a lump sum or an income stream or a combination of the two.

My wife is getting my super and insurance. What are her options?

Superannuation law requires that death benefits be dealt with as soon as practicable after somebody passes away.

SMSF’s are legally required to report all assets at a market value each year-end.

Why your SMSF auditor is suddenly so interested in valuations

The additional evidence about your unlisted holdings is required because such entities are harder to value and therefore more difficult to audit.

August

You can direct future pension payments to your spouse.

Is a binding death nomination or reversionary pension best?

Here are the options when nominating the people who will benefit from your superannuation on the event of your death.

Division 296 will change the way earnings from super accounts with high balances are taxed.

Is it still worth contributing to superannuation once I hit $3m?

If you’re fortunate enough to be nudging $3 million, super is no longer the only game in town.

The law defines when a superannuation income stream commences,

Should I take my super fund to court for a timing error?

The ATO does not have the power to amend the dollar amount recorded as your balance on the day you commence an account-based pension.

July

The assets must be disposed of at their market value.

Can my SMSF sell these assets to family without landing in trouble?

There are no restrictions on selling self-managed super fund assets to a related party as long as you are paid the market rate.

Prior to age 65, the minimum pension drawdown amount is 4 per cent.

How do I maximise my tax-free pension if I give money to the kids?

Keeping your pension account as large as possible and running down your accumulation account is a sensible strategy.

The transfer balance cap for superannuation pensions rose to $2 million on July 1.

Can I stop my super pension and then restart it again later?

When you start a pension, the system creates a personal transfer balance account that tracks all your retirement phase transactions for life.

Your tax bill might still be relatively small.

What if my late spouse’s super pushes me over $3m?

Readers have been peppering us with questions about Labor’s proposed tax on super balances above $3 million. Here are three.

June

Division 296 will change the way earnings from super accounts with high balances are taxed.

How defined benefits pensions will be treated under Division 296 tax

Defined benefit pensions may present special challenges, but they will not escape the government’s proposed $3 million super tax.

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If your payment is compensation for an injury and classified as a structured settlement payment it will not be included in Division 296 tax calculations.

How insurance payouts will be treated under Division 296 tax

Life insurance payouts for death, disablement and terminal illness will be included for the purposes of calculating the additional tax.

Products offered outside the retail client space are higher risk and may not be as liquid.

How can my SMSF qualify as a ‘sophisticated’ investor?

Consumer protections are far greater for retail investment products than those sold to wholesale investors.

May

Division 296 is not a straight 15 per cent levied on earnings above $3 million.

This is the No.1 misconception about the $3m super tax

Only a portion of earnings will be taxed at 15 per cent, which means tax bills will be lower than people think.

Since the election the Albanese government has made it clear that it will be proceeding with the introduction of the Division 296 tax on super.

How much extra tax will I pay if my super balance is $3.1m?

An important consideration you will need to know is the imposition of the new Division 296 tax on individual superannuation balances, assuming it becomes law.

Sometimes in super, there is no in between.

Help! I still don’t understand how all the super caps work

The super system features a range of limits designed to restrict tax advantages to levels parliament has deemed reasonable – and their interaction is complex.

Original URL: https://www.afr.com/topic/super-q-a-1mwt