SMSF Association Submission
The SMSF Association welcomes the opportunity to make a pre-budget submission for the 2020-21 Federal Budget. As leaders of the SMSF sector, we believe we are able to offer insights on some key issues from the perspective of an industry that has grown to represent approximately $750 billion in assets and over 1.1 million SMSF members. The SMSF sector is an integral part of Australia’s superannuation system and economy.
This year our submission focuses primarily on improving the simplicity and accessibility of the superannuation system for the benefit of consumers and those who advise them.
We submit to the Government that now is an opportune time to begin a pathway to improve the framework for which advice is provided in Australia. With the implementation of the Financial Services Royal Commission recommendations underway, they provide a stepping stone to reducing complexity, cost and improving the ability of consumers to access affordable quality advice.
We believe the limited licencing framework has failed and the Government should begin new steps to transition to a new consumer-centric framework which rectifies the current regulatory burden which exists in SMSF advice, raise advice standards and rectifies the advice gap.
In addition, we believe it is also essential that superannuation and SMSF advisers are able to access Australian Tax Office (ATO) portals to facilitate efficient advice. The current complexity of the superannuation system not only requires simplification, which we propose, but also requires advisers to be able to efficiently obtain timely data for their clients. Access to such data is currently restricted to tax agents.
We also propose that a spousal rollover measure be introduced for superannuation fund members. This measure would provide an effective and efficient way to significantly reduce the superannuation retirement gap between partners, particularly for women.
The SMSF Association also continues to believe that the current contribution caps are inadequate, particularly for older Australians. Restrictive caps do not incentivise individuals to save for their retirement during the years in which such saving is financially affordable for them.
Moreover, our submission highlights significant complex issues such as the restrictions facing SMSF members who reside outside of Australia, death benefit complexity and the need for an amnesty for legacy pensions in SMSFs.