Self-Managed Super Fund (SMSF) – Planning for the Unexpected
Planning ahead for your self-managed super fund is important. As trustees, you should have plans on what to do in case a relationship breaks down or if a member becomes incapacitated or dies.
A few things to consider when making your SMSF plans:
Plan for what will happen to the fund if a member leaves. This may mean adding a new member, changing the type of the fund or winding it up.
Payments to be made from your Self-Managed Super Fund must meet the laws, rules and the trust deed of the SMSF. Before setting up the fund it is best to make sure that the fund include situations like terminal illness, incapacity or death of a member.
Tax and super laws should be met by the payments. In certain cases, the tax should be withheld before payment of a super benefit can be made.
Consider the insurance needs of members when you set up an investment strategy. Consider a binding death benefit nomination to nominate individuals whom you want your super benefits to go to when you die. Consult an SMSF adviser or estate planner to help you get this right.
As a trustee, you should also consider the situation in case you become incapable of looking after yourself and your affairs. You might want to appoint an enduring power of attorney who can act as a trustee of the SMSF if needed.
If there is a relationship break down in the SMSF, be prepared to sort out issues that may arise because of the breakdown. You will not be able to force a member to leave or stay in the self-managed super fund or exclude them in the decision-making processes of the fund.
Set all the plans before you start the fund to prepare for the unexpected. An SMSF auditor and a professional will help you make these plans.
Talk to us and we will help you set your plans for your SMSF.
Kingston Knight Audit are the Auditor Melbourne experts to contact when dealing with your trust account audit, SMSF Audit, financial statement audit, and internal audit requirements. Contact us today, Kingston & Knight Audit offers a free telephone consultation to establish how we can best help you achieve the assurance and compliance you require.