superannuation question - which are great?, page-6

Insider,

I was put onto an accountant in Perth (when I lived there) and they explained the whole process. So I suggest that you chaswe up an accountant that is competent in the Self Manageged Superannuation Fund (SMSF) field.

First thing the accountant had me decide is which vehicle I required as trustee of my SMSF. A SMSF must have a trustee which can be either a Family Trust or a company structure. The family trust requires at least two members (I think) and is cheaper to set up than a company. However, I chose to set up a company with me as the sole director / secretary / shareholder. The accountant strongly reminded me of my duties as a company director and trustee for the super fund and of the consequences of failing in those duties. I also had to come up with a brief investment plan for the super fund which again has consequences if you don't follow that plan. Consequences might include the super fund being declared non-compliant by ASIC and then being taxed at company rates instead of the 15% superannuation rate.

I needed to get tax file numbers for the company and the SMSF and also have the SMSF registered as a compliant superannuation fund with ASIC. This took about a month. The accountants handle all this after I signed the a bunch of paper work. Eventually I was notified by the accountants that I had an ACN and TFN for the company/super fund.

Then I set up a bank account to hold monies from rolling over from other super funds, contributions, diidends, tax returns etc. I need to keep good records of where the money goes and comes from for the accountants to use at tax time.

From there on you do what you want with the money in order to increase the net worth of the super fund e.g. invest in shares, lend at commercial interest rates, put it high interest bearing accounts/property trusts and such like.

You can also buy a rental property provided no member of the super fund lives in it but you can not take a loan (ie mortgage) out in the name of the super fund. I guess super funds taking out loan is deemed to be too risky to the fund's assets.

So I hope all that is of help and of interest.