The SMSF Association is the peak professional body representing the SMSF sector throughout Australia, established to continually improve the quality of advisors, the knowledge of trustees and the credibility and health of the self-managed super fund (SMSF) sector.
The SMSF Association is actively involved in discussions with key members of Government and Opposition, sector stakeholders, regulators and policy makers.
As an Association we have been instrumental in advocating for the SMSF sector and have been directly involved in:
- Altering the Productivity Commissions position that an SMSF is only cost-effective at balances of $1 million down to $500,000
- This includes ensuring that SMSFs remain available as a choice to all, regardless of their stage in life or superannuation balance
- Significant COVID-19 relief for the SMSF sector regarding a reduction in minimum pension withdrawals, rental relief, LRBA relief, electronic signatures and others
- Introducing measures to improve the flexibility of superannuation such as advocating for higher concessional caps and catch-up contributions
- Ensuring a period of sustained stability in superannuation by supporting polices based on efficiency and fairness of the system
- Encouraging the implementation of digital rollovers between SMSFs and large superannuation funds
- Improving ethical and professional standards for financial advisers and extension of the FASEA standards to allow an extra year to complete the approved exam (1 January 2022) and two additional years to meet its qualification requirements (1 January 2026)
- Ensuring limited resource borrowing arrangements remain as an investment option for SMSFs
- Technical fixes and superannuation reform for measures such as:
- correcting debit values for defined benefit income streams,
- untaxed elements in death benefit rollovers,
- streamlining ECPI changes
- raising the work test age
- simplifying the work test exemption test
- ensuring reversionary transition to income streams can continue to spouses
- targeted LRBA total superannuation balance changes
- ensuring quarterly ATO reporting is targeted to appropriate funds
Our Key Policy Positions
The SMSF Association strongly supports the Financial System Inquiry’s recommendation to set the core objectives of the superannuation system with the primary goal of the system but believes it is essential that the objective includes a notion of adequate retirement incomes. We believe the primary goal of the system should be:
“To provide income in retirement to substitute or supplement the age pension, delivering a financially secure and dignified retirement for Australians.”
Setting the goals of the system will help promote stability in superannuation which is critical to savers having confidence in the superannuation system and making long term savings decisions.
The SMSF Association strongly believes that the taxation of superannuation should be considered with regards to superannuation’s long-term goals of providing income in retirement and reducing reliance on the age pension. Accordingly, we believe appropriate tax concessions are needed to encourage contributions to superannuation and to compensate people for locking away their money in superannuation for long periods of time.
In addition to achieving these important goals, we believe that an equitable and sustainable superannuation system is needed so that it is accepted by both policy makers and the public in order to bring long-term stability.
We are constantly working with Government to reduce red-tape and complexity in the superannuation system. We currently believe:
- The work test should be repealed
- Total superannuation balance thresholds should be aligned
- Transfer balance cap indexation should be simplified
- The superannuation residency rules are outdated for SMSFs
- Legacy pensions should be flushed from the system through an amnesty that allows them to be converted to modern pension products
The SMSF Association supports the current Government policy to improve the quality of financial advice by raising the minimum education standards for financial advisers, ensuring advisers are engaged in continuous professional development and adhering to a professional code of conduct amongst other requirements.
We believe the desired policy outcomes from introducing limited licensing have not been achieved. Individuals have unmet needs, advisers face high regulatory costs and burden and accountants are strangled by regulation.
The SMSF Association is working on a new consumer-centric advice framework which aims to improve how SMSF advice can be provided.
We also believe financial advisers should be provided with access to the ATO tax portal for their clients, so they can provide timely, efficient and accurate superannuation advice.
The SMSF Association disagreed with the Financial System Inquiry’s recommendation to ban superannuation funds from using limited recourse borrowing arrangements (LRBAs) and welcomed the Government’s decision to not abolish LRBAs. We believe there is little evidence that borrowing in superannuation is causing a build up of excessive risk in superannuation.
We believe that SMSF trustees seeking to use LRBAs should seek professional advice as to whether they are right for their circumstances.
Recent Treasury analysis stated that while future superannuation balances at retirement will continue to increase for both genders, women’s balances will continue to lag behind men’s balances until post 2060. The main problem with the current limited spousal measures is convincing young couples to take advantage of these strategies, when young people tend to concentrate on other issues such as paying off mortgages and educating children. Couples are more likely to consider these strategies when they are approaching retirement and it may be too late to implement effectively.
The SMSF Association proposes that a spousal rollover measure be introduced for superannuation fund members. In essence, the measure would allow an individual with a higher superannuation balance to rollover a portion of their superannuation balance to their spouse in order to help equalise balances. This measure would provide an effective and efficient way to significantly reduce the superannuation retirement gap between partners and improve equalisation between couples, particularly for women.
The SMSF Association believes that the current contribution caps are inadequate, particularly for Australians approaching retirement age. The current concessional contribution cap of $25,000 per year for older individuals has negatively affected their ability to save an adequate amount of superannuation to be self-sufficient in retirement.
We believe superannuation policy should incentivise and encourage Australians to take ownership of their retirement planning and contribute to their superannuation accordingly. For those individuals over 50 the policy settings should be improved.
We recommend that individuals over the age of 50 be able to access a higher concessional contribution cap. We suggest that the cap for individuals over 50 should be set at $35,000. This provides an extra $10,000 per year which can be used by those who are planning for retirement and result in a significant positive impact on their lives.
We believe that SMSF auditors are the “gatekeepers” of the SMSF sector, making sure that funds are meeting their legal obligations. Accordingly, we believe it is essential to the integrity of the SMSF sector that SMSF auditors are appropriately skilled and qualified.
Latest submissions and media releases
The SMSF Association’s annual Technical Summit is always replete with topical issues presented by industry experts – and this year’s virtual event is no different. Association CEO John Maroney says
“The intergenerational report (IGR) clearly illustrates the importance of building superannuation savings to offset the growing liabilities related to an aging population”, according to John Maroney, CEO of the SMSF
SMSF Association Submission – Improving visibility of superannuation assets in Family Law proceedings
SMSF Association Submission The SMSF Association welcomes the opportunity to provide this submission in response to the Government’s proposed superannuation information sharing process in Family Law matters. They will help
The Parliament has passed legislation allowing an increase in the maximum number of SMSF members from four to six – a Federal Government initiative the SMSF Association welcomes. If the
SMSF Association Submission The SMSF Association welcomes the opportunity to provide a submission on Treasury’s two exposure drafts in relation to the requirement for actuarial certificates for certain superannuation funds
SMSF Association Submission The SMSF Association welcomes the opportunity to provide a submission on consultation paper: Transition to strengthening client verification (QC65469). We welcome any measures that seek to improve
The SMSF Association regularly release media statements to communicate policy and advocacy positions, with the below members of the Association’s team availabe for comment and interview.