SMSF Accounting explained.

A Self Managed Super Fund (SMSF) is a type of superannuation trust with the sole purpose of providing benefits to its members upon retirement.  A major difference between an SMSF and other (industry/retail) superannuation funds is that the SMSF members also act as the trustees of the fund. An SMSF can have up to four members. The members would generally pool all of their super fund balances into one fund and then make combined investments using the pool of funds available. All of the investments are being self managed, hence the term ‘self managed super fund’. Given that the fund invests the money and generates income from the investment, there is a requirement to report the income, as well as pay taxes on that income. The effect of tax creates the need to carry out accounting work, which is best carried out by a qualified SMSF accountant given the complexity of tax and accounting laws in relation to an SMSF. This is because an SMSF accountant will be well versed in these tax laws. The complicated administration and accounting aspects of SMSF can be burdensome to do by yourself, which is why the best decision you can make for your SMSF is to seek out an SMSF accountant who can help you with the compliance aspects of the SMSF.  We are also registered SMSF auditors hence we are aware of the audit requirements which are to be met.

SMSF Accounting Responsibilities

An SMSF will need a TFN, ABN and a bank account which would allow the fund to make investments, receive contributions as well as to pay out pensions and lump sum payments. Not to mention, that an SMSF has many accounting responsibilities to ensure their compliance with the relevant superannuation legislation (The SIS Act).  These SMSF accounting responsibilities include but are not limited to:

  • Signing and submitting a trustee declaration to the Australian Taxation office (ATO) after setting up the fund accepting that they are aware of all their responsibilities
  • Maintaining records and providing up to date financial statements.
  • Preparation of minutes pertaining any new resolutions and changes.
  • Completing a tax return.
  • Organizing an audit with a licensed auditor.
  • Lodging the tax return once audited.

There are a range of penalties imposed by the ATO on SMSF trustees who fail to comply with their obligations. Given the strict legislation relating to SMSFs’ and the severity of non compliance, it can be really stressful, difficult and time consuming to keep on top of all of the ever changing SMSF legislations whilst ensuring that you are correctly carrying out all of your SMSF accounting and staying compliant with the SMSF legislation. This is why it is really valuable to find an SMSF accountant who has plenty of knowledge and experience in SMSF accounting and SMSF legislations to take care of your SMSF accounting work for you. Letting an SMSF accountant take care of all the SMSF accounting work for you will allow you to spend your time more valuably where you want to spend it. And you can be sure that all of your SMSF accounting work is being done correctly, taking all the stress off of your shoulders. You do not want to risk making any errors, but with so many complex rules and legislations surrounding SMSFs, it can be really difficult to achieve this. This is why, an SMSF accountant who is well aware of SMSF legislations and undertakes regular professional education to keep up with the changes will be able to do this for you easily and efficiently.

How can our SMSF accountant help?

SMSF accountants are more than just professionals counting money or preparing and printing reports. SMSF accountants have detailed knowledge of SMSF law, tax and SMSF investments.  Since establishing an SMSF will be one of the most significant decisions that you will make with regards to your future retirement savings, it is really important that you hire an SMSF accountant for the compliance aspect of the fund. An SMSF accountant will be equipped with the right skills, knowledge and experience to carry out the compliance aspect from as well as SMSF Accounting and SMSF tax return point of view. SMSF accountants & auditors have to adhere to specific training and education requirements on a yearly basis to maintain their registrations.

Once the client has decided to proceed with starting an SMSF, an SMSF accountant will generally sign you up for an SMSF accounting software. Post this, the SMSF accountant will also take on the responsibility of preparing the SMSF’s financial statements and the tax returns as they become due. An SMSF accountant will prepare reports keeping in mind the relevant Australian accounting standards as well as the relevant and current legislation and regulations applicable to SMSFs, including valuations of assets. These relevant legislations have become complex over the past few years and seem to be getting even more complex with each passing day. An SMSF accountant will have in-depth knowledge about all SMSF legislation and will have access to handy resources as or when required.  SMSF accountants will also prepare relevant and important minutes, members’ statements and the annual tax return for SMSF. Once the annual tax return has been audited by a professional and licensed auditor – the SMSF accountant will proceed to lodge the tax return to the ATO.

Why Choose A One Accountants as your SMSF Accountant?

At A One Accountants, we have a team of passionate SMSF accountants dedicated to providing the highest level and standard of SMSF accounting. Our SMSF accountants have in-depth knowledge as well as plenty of experience when it comes to SMSF accounting. All accountants working for A One Accountants receive regular training and coaching to maintain quality and high service standards. We will put our best efforts to stay compliant with all SMSF legislation, whilst making sure that you gain the most when it comes to your SMSF.

If you would like to find out more or discuss your circumstances with an SMSF accountant at our practice, please give us a call on 0386091889 Monday-Friday 10am-6pm.

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