Setting up a self managed super fund requires knowledge and experience. And that is why you should rely on a professional help. In order to be eligible for tax concession and receive contributions, your self-managed super fund needs to be set up correctly. That will also makes easy for you to manage it.
Here is what involves in setting up a self managed super fund:
1. Choose A Reliable Professional To Help You
Setting up a self managed super fund is a challenge that you may not be able to accomplish by yourself. There are many SMSF professionals including financial advisers and accountants that you can count you help you set up and also run your super fund.
2. Select Individual Trustees Or A Corporate Trustee
You have two structure options for your SMSF. You can choose either to have individual trustees or a corporate trustee – in that case it will be company that will act as trustee for the fund.
3. Establish The Trust And Trust Deed
A self managed super fund is a type of trust. To create a trust you will need trustees, beneficiaries and assets. A trust deed is responsible to set out the rules for creating and managing the fund.
4. Take A Look At The Residency Of Your Fund
In order to be able to receive tax concessions to be a complying super fund, your SMSF needs to be all the time, during the income year, a regulated resident super fund. Neglecting the residency rules will lead your fund to be taxed at the highest marginal tax rate.
5. Designate Your Trustees
All directors and trustees should sign a declaration within 21 days declaring that they understand their responsibilities and tasks. Make sure all members are eligible to be a trustee.
6. Get Registered With The ATO
Your self managed super fund needs to be registered with the ATO. With that you will be able to elect for your fund to be regulated, get an ABN and TFN, and if necessary register for GST.
7. Set Up A Bank Account
To accept contributions and pay the expenses and liabilities of the fund, your SMSF needs to have its own bank account. If your SMSF are going to receive contributions from employers, it will need also a SuperStream electronic service address.
8. Create An Investment Strategy
Before start making any investments, you must have an investment strategy. Another important thing to remember when setting up a self managed super fund is to prepare an exit strategy. Take into consideration what happens in case the SMSF ends.