1) A SMSF allows individuals to control their own superannuation investments but requires responsibility and administrative work. 2) SMSFs can invest in various assets like shares, property, and managed funds but cannot invest in related parties or assets for personal use. 3) Property is a popular SMSF investment but funds must be used for commercial purposes and leased at market rates if owned by related parties.

1. For
Business Owners
Superannuation
& SMSF

2. Disclaimer
All material of whatsoever nature contained in or provided in
connection with any SuperBenefit presentation, and in particular,
with regard to today’s presentation, is for education and general
information purposes only, and does not constitute advice,
personal or otherwise.
SuperBenefit education and general information is provided
on the strict basis that you
• do not act solely because of anything contained in or
associated with this presentation and, if you do wish to act,
that you first
• seek alternative independent advice where all your
individual objectives and needs are professionally
considered before you make any decisions, financial or
otherwise.

3. How much need to retire
Three levels – ASFA Retirement Standard Aug 2016
Level Like/explanation Single Couple
Basic Pension $20,300 $30,600
Modest Above Pension –
Local travel, cheap
restaurant
occasionally
$23,700 $34,226
Comfortable Good Standard –
occasional o/seas
travel, restaurants
$43,100 $59,200
% of Aust Pop.
on-track for
Comfortable
http://theconversation.com/the-
majority-of-australians-are-not-
saving-enough-for-retirement-24957
22% 53%

4. Life Expectancy
In Summary –
Males have 20-31 years to fund
Females have 24-34 years to fund
Say aveg. 25 years at $45,000 comfortable single lifestyle … requires $1,125,000
(no interest/earning)
Or –
$900,000 at 5% … will generate $45,000 per year
(dividends can be 4-8% or more, property aveg. Is 3-4%)

5. Superannuation Overview
• Super is -
a long term savings arrangement in preparation for retirement
• Part of the government’s plan to -
to ensure adequate retirement income
• Who can contribute -
Employers, self-employed, employees and family members
• Contributions can be made to 3 types of funds (You have Choice of Fund)
– Independent large super funds - retail, industry, bank and financial
institutions (APRA – Australian Prudential Regulatory Authority)
– Retirement Savings Accounts (RSA) banks, institutions (rare)
– Self managed super fund (SMSF) you manage it (ATO)
• Self Managed Superannuation Funds also known as
– SMSF’s
– DIY Funds.

6. Average Super Amounts
http://www.solepurposetest.com/articles/average-superannuation-balance-by-age/

7. Budget on Superannuation
May 2016
Area Was 1/7/17 Notes
Concessional Cap.
(get tax deduction)
$30k or $35k over 50
YO
$25k indexed with
wages growth
Reduces ability to
save
Needed work test or
10% of income was
from employment
Personal Contib. up
to 75 YO
Self-Employed not
penalised
Extra years
Non-Concessional
(no tax ded. After
tax)
$180,000 or 3 years
bring forward is
$540,000
$500,000 max
lifetime cap
Reduces amount can
place in super for tax
reduction
Pension NO Max Balance for
tax free, all as
pension account
Over $1.6 mill will
be taxed 15%
Only 200,000 have
$1mill over in their
super accounts

8. Self-Managed Super Fund
Bank Account
Cash, Shares, Managed Funds,
Property
As Members
As Trustees
Participants in a SMSF have 2 roles
… as a Trustee, and as a Member
(Corporate Trustee has members as Directors)
Admin,
Tax Return, Audit
1 What is a SMSF?

9. SMSF Pros
– Control over investments
– Flexibility of investment timing
– Choice of investment spread
– Protection from bankruptcy and other legal claims (most cases)
– Low-tax saving environment
eg Dividend $100 Franked you receive (ie Company Tax of 30% paid)
eg $142 less 30% Co. Means Tax paid is ($42) Leaves $100 to you (rounded)
at tax time means (rounded)-
Life Stage Outside SMSF (your MTRate) Inside SMSF (15% tax)
Work, MTR 30% pay no extra tax > $nil extra credit 15% > $21 back
Work, MTR 45% pay 15% tax > $21 pay credit 15% > $21 back
Pension 0% (over 60) may affect aged pension, ?% credit 30% $42 back, Tax 0%.
2 Pros & Cons

10. SMSF Cons
– Responsibility – Penalties: 46.5% tax, fines for non-
compliance
– Administration involved is large
– Your suitability to manage investments
– Complaints – no access to Super Complaints
Tribunal
– Commitment and work involved
– Need to seek assistance with investment knowledge
and compliance.
2 Pros & Cons

11. Investment Choices
SMSFs can invest in various asset classes including:
• Shares, Options, CFD’s ,Covered Call Options
• Property – Residential and Commercial
• Managed Funds
• Term Deposits and Cash
• Government Bonds
• Exotic Assets (with a proviso***) such as:
• Art and Collectables
• Cars, Wine
• Antiques, Jewellery
***Main issue is you cannot USE/Enjoy them YET – breaks the Sole
Purpose Test and is a breach of the SIS Act - S62 & Reg 13.14.

12. Invest in Shares

13. Cannot Invest in your Company
A SMSF can only invest/purchase in assets that are not involving related
parties
Investments involving/owned by related parties are called “In-house
Assets”. The ATO defines them as follows –
An in-house asset is a loan to, or an investment in, a related party or trust of the
fund. An asset of the fund that is leased to a related party is also an in-house asset.
You are restricted from lending to, investing in or leasing to a related party of the
fund more than 5% of the fund’s total assets. There are some exceptions, including
for business real property that is subject to a lease between the fund and a related
party of the fund…
See also S69-75
A related party includes a company associated with an SMSF member/trustee.
1 Can my Business be my Super?

14. Can Invest in your Factory/Office
• A SMSF can invest in ‘Business Real Property’ - that is
commercial or industrial property, shop, or farm, with
CURRENT Business Running in the same way as residential
property
• Unlike residential property, a SMSF can buy business real
property from fund members (or relatives of fund members)
• Members can use that asset if they choose to do so
• Any lease must be at market rent with the terms and
conditions of a typical commercial lease
• Business real property can also be transferred as an in specie
(non-cash) contribution, subject to contributions caps, and any
small business retirement exemptions available (if applicable)
• Any capital gains tax payable on the transfer is a tax bill for the
individuals who originally owned the asset rather than the
SMSF,
• In some states, stamp duty may be payable.
1 Can my Business be my Super?

15. Invest in Property
1 Buy Property
SMSF with Property Borrowings:
Bare Trust
Owns
until loan
paid
Lender
SMSF
Lender has security
Lender loans $280k
$400k
$280k
$120k deposit and $30 costs
Current Total $200k - diversify -
$120k for property
$80k for other investments
SMSF has a beneficial interest
$
Rental Income
Regular 9.5%
Employer Super
and/or Salary
Sacrifice

16. High Yield
Balanced
High Growth
Property – Where?

17. SuperBenefit Programme
... when interlocked with a Self-Managed Super Fund
SuperBenefit
Self-Managed
Superannuation
Fund
b
As Members
Strategy Workshops
“Understanding Through Learning”
Estate Planning
Retirement Planning
Tax Planning (etc)
“Sharemarket-Savvy”
Education & Training
”Coaching” Coordinator
Administrator
Education Coordinator
SUPER
ADMIN
SERVICE
Solicitor
(Fund Trust Deed
& Other “Legals”)
As Trustees
Tax
Accountant
Audit
Accountant
All Fund Administration and
Trustee Compliance
Servicing Including:
Establishing and Maintaining
(1) Member & Fund A/cs
(2) Trustee Minutes
(3) Buying, Selling and/or
Lodgement of Managed
& Direct Investments, and
(4) All other Fund/Trustee
Administration Servicing
Seminars, Workshops and
One-on-One Mentoring,
and Coaching
Investment Empowering
Managed Fund
eg Asian Shares
(CMA)
SuperBenefit
Qualifying
Shares
Cash
“Assisted” &

18. Have questions?
SuperBenefit works with SMSF trustees to
CONNECT them with the advisors they need.
A call is Free.
If you have any questions, why not give us a call – it’s FREE!
No obligation. 0407 361 596, Paul.
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19. Administrator Manager