SMSF Annual Obligations

An SMSF has a number of annual obligations that the trustees need to ensure that they adhere to or else face fines and penalties which can be quite substantial.  The ATO are becoming stricter on trustees and are now even contacting a number of new trustees to quiz them on whether they understand their responsibilities.  This is being done before they issue the ABN and register the fund as a regulated super fund which entitles it to receive rollovers and contributions.  The annual obligations of an SMSF include the following;

  • Ensure that if the fund is in pension mode the required minimum pension payments have been made prior to 30 June to ensure the fund maintains its tax exempt status;
  • Ensure the assets are all valued at market value as at 30 June;
  • If the fund has members in both pension and accumulation mode ensure an actuary certificate is obtained to confirm the funds tax exempt percentage;
  • Ensure the funds year end financial statements and annual return are prepared;
  • Appoint an approved auditor no later than 45 days before the SMSF annual return is due to be lodged;
  • Ensure the SMSF annual return is lodged by the due date;
  • Review the funds investment strategy and document appropriately;
  • Ensure all the records of the fund are being maintained in accordance with the super laws;
  • Ensure the ATO is notified of any change in trustee structure, members, addresses or change in fund status;

Being a trustee of an SMSF should not be taken lightly.  Serious consideration should be given to not only the requirements themselves but also how the trustee is going to meet these requirements.  This may involve the trustee delegating some of these duties to specialists in the area to ensure compliance is maintained.