My husband and I are recently married and in our mid-50s. We have been discussing setting up an SMSF and joining our super to invest in property and would like to know what steps we need to take, is there a certain percentage of our individual super we can only contribute or can it be all of it?
If you are unaware/unsure about the complexities surrounding a SMSF, the best advice you can get is to sit down with an Accountant and Financial Planner and get the RIGHT advice. I know everyone is still uncertain about Financial Planners (there are still some questionable ones, few and far between now) but a good planner will run through your situation, advise on the cash flow requirements and make sure your plan will work for you. Charging fee for service these days means they can happily discuss property as well as shares etc..
Speak with your accountant (if you have one) and get a referral from them. Either in-house or external, they can review and discuss the plan (possibly not give advice though). Your accountant can then discuss your obligations and requirements as trustee for your fund.
These are not simple little products to have, can be costly if borrowing (both set-up and annual costs) and extremely costly if you get it wrong.
Best of luck.
Todd has hit the nail on the head here Fiona. Whilst SMSF are great, they are complicated and you need to ensure that you know what you are getting yourself in for BEFORE you go setting one up.
And to give you an idea of the costs of getting it wrong consider this: if a SMSF is deemed to be non-complying it can be taxed as follows:
a) 45% of the funds income for the year
b) 45% of the funds ASSETS too!!!
I must admit that I have never seen a fund get hit with 45% tax on its assets, but the ATO CAN do this.
so the moral of this story is that your retirement nest egg is VERY important, hence you need to make sure that if you want to manage it yourself, you know what you are doing!! This doesnt mean you need to memorise the SIS Act, but you need a good working knowledge of what you CAN and CANT do, and you need to engage experts to assist you in this.
And for Gods sake, dont go to one of those cheap-arsed online SMSF hawkers: the ones that promise you heaps, eg
- free setup
- free first years accounts
- guaranteed fees including audit $750
These cheap and nasty "service" providers make their money by forcing you to invest in a very small selection of assets: ones that pay them a nice commission. So, whilst you think you are getting a sweet deal, you are actually getting ZERO advice, and you are paying through the nose for it!!
if your accountant doesnt have CA or CPA tacked onto their name, ask questions!!!
If you planner doesnt have runs on the board and a list of VERY satisfied clients to talk to, ask questions!!
actually......ask questions anyway:):)
and good luck. Despite the horror stories there are a LOT of very happy SMSF trustees who are not being locked up for pinching their super early:):)