The SMSF Club | SMSF Trustee Obligations
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SMSF Trustee Obligations

23 Jun SMSF Trustee Obligations

Happy End of Financial Year! The fast approaching financial year-end serves as a reminder of our obligations as a trustee, or a director of a trustee company, of an SMSF. It is the perfect opportunity to highlight the SMSF’s regulatory obligations and make sure we are prepared to meet these obligations.

Annual Financial Statements and Tax Returns

All SMSF’s need to prepare financial statements annually, have the statements independently audited, and lodge a tax return with the ATO.

While The SMSF Club undertake the preparation for the financial statements and organises the audit, there is an onus on the trustees to provide documents that will allow us to prepare the accounts and have them audited.

Having a fund independently audited means that all figures need to be substantiated, transactions need to be verified using supporting documents such as invoices and contracts. While we do have a copy of some documents we might have to ask for others.

Organisation is vital to a successful audit; begin preparing for the year end by storing all your SMSF documents in one place and sorting them out by the relevant year.

Quarterly Instalment Activity Statements and PAYG Instalment Statements

In Australia, if you lodge a return with SMSF income above a threshold, you need to start paying PAYG instalments. After the fund lodges its tax return, the ATO will assess if there is a need for your SMSF to be in the PAYG instalment system based on the information provided in your latest tax return.

Pay As You Go (PAYG) instalments require you to pay incremental amounts towards your SMSF’s expected end of year income tax liability. These instalments are offset against the income tax figure when the funds income tax return is prepared after the financial year end. For most funds, these payments are made quarterly and payments are generally due by the third week of the month following a financial quarter.

Some newer funds would have received correspondence from the ATO prompting them to lodge their Activity statement. This requires you to make the instalment payment to the ATO; there is no physical lodging of a return. On receipt of the payment, the ATO will update the status of the form to ‘Processed’.

Annual Obligations with ASIC

The Australian Securities and Investment Commission (ASIC) are responsible for the administration of corporations in Australia. If you have a Corporate Trustee or a Custodian Company, there are additional annual requirements for ASIC.

Every company has an annual review date which is normally the anniversary of its registration date. Soon after the annual review date, ASIC issues each registered company with an Annual Statement and an Invoice for the company’s annual review fee.

The annual review fee has to be paid before the due date otherwise the company will incur additional penalties.  Again there is no requirement to physically lodge a return unless you need to notify ASIC of any changes.

If you have any questions please contact your SMSF Adviser.

Happy Investing.