SMSF Investment StrategiesSharing Simple Strategies for Self Managed Super Funds
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Help with SMSF adminstration and compliance
June 30 is fast approaching so this is the time of year when we start thinking about the tax, accounting and audit requirements for our SMSF. Many thanks to everyone who answered our survey question “What help do you need most with your SMSF?”. The answers will help me decide on what to write about. Most people said “Investment Strategy” which is what this blog tries to provide but quite a few people mentioned “Administration and Compliance” as well. For our SMSF, we choose to use the services of professionals to help us with the administration of our SMSF as we prefer to focus our efforts on managing our investments. Every SMSF trustee must understand the compliance requirements but the investment rules are not hard to comply with. The key ones are clearly stated in the document Running Your Self Managed Super Fund – your role and responsibilities as a trustee from the ATO website. SuperGuide.com.au is good website that provides a lot of good independent information on super rules but if you want to try investing in something that you are not sure would be compliant, then do seek the advice of a good accountant before you do it.
Last year I spent quite a bit of time looking for a good accountant for our SMSF. I wasn’t happy with my old accountant whom I felt had become more interested in selling products to his clients rather than on improving his accounting and tax expertise. I looked at a few “full service” SMSF administrators who give you tools to manage your investments but they usually require you to be tied to a specific broker and bank. I suspect these companies get paid commissions by those brokers/banks. I prefer to have the freedom to choose my broker and bank so I can change them if there are others who can provide me with better fees or service. Furthermore, as we invest in the US markets, we have accounts with US brokers and I doubt any of them can provide direct integration with those broker platforms.
I found a good accountant that I liked but unfortunately he was not very familiar with investment strategies involving exchange traded options and was honest enough to tell me that. Some of our friends have told us that their accountants have told them that SMSFs are not allowed to invest in options, simply because the accountant himself does not understand options. Fortunately, a partner from a well known accounting firm has written a document on the tax treatment for options and made it available on the ASX website. You can find the link in the Resources area of this blog.
I decided to use DIY Super Fund, a no frills accounting service who specialise in SMSFs and was also familiar with my options based investment strategies. I collate my investment transaction into spreadsheets myself to reduce the work that the accountant needs to do and hopefully that also reduces the cost as well. So far I am pretty happy with the service and best of all, they stand behind the work they do. My old accountant asked us to buy audit insurance (for which they get paid a commission) in case we get audited by the ATO. My new accountant said that if we get audited by the ATO, they would do the audit for free as part of their service. I was very impressed with that as it goes to show that they are confident with the service they provide. Hope this helps those of you who are looking for help with administration and compliance.
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Christina
Thanks for praising our services – along with your smsf – we make it our point to learn whatever is there to learn in SMSF space.
By keeping away in selling products we have found that we can concentrate in what we do best – compliance.
Manoj Abichandani
http://www.diysuperfund.com.au
Let me just take the opportunity as an SMSF Accounting to say; the more prep work you do before sending your stuff to the accountant the better off you’ll be. When you meet with your accountant, or you are interviewing new ones ask, “What can I do to reduce my fees,” they’ll often be happy to give you direct guidance in some very specific things you can do to keep your fees down.
Nothing blows fees out of proportion like compliance issues (pulling money out of the fund “by accident”) or poor information (missing statements, unknown transactions etc). It’s not good for you because it will push your fees up, and it’s not good for your accountant because it stalls their workflow and turn around.
Hi Chris
Thanks for your useful tips. That’s what I do with my accountants. I ask them to send me their spreadsheet templates and I fill in the data for them and then I upload it into their intranet folder. I popped by your blog and read your June 10 post – I wish my 19 year old daughter is as ambitious as you. All the best in your business endeavours!