The Super System Review has released Self-Managed Super Solutions, its report which sets out the Panel’s preliminary recommendations on self-managed superannuation funds (SMSFs).
The Panel supports trustees keeping control over their SMSFs: it is not proposing compulsory education for trustees or requiring third party custodians to hold SMSF assets. It is also not proposing that all SMSF’s have corporate trustees or that there be a minimum SMSF asset size.
In support of its principal concern for the integrity and adequacy of retirement savings, its key preliminary recommendations include:
- prohibiting investment in collectables and personal-use assets (such as artworks, wine collections, exotic cars and yachts);
- reducing the potential to benefit illegally from related party transactions by prohibiting the acquisition of in-house assets and imposing restrictions on the way in which an SMSF can transact with related parties;
- strengthening the competence and independence of approved auditors;
- expanding the ATO’s enforcement powers;
- tightening the SMSF registration process, including the introduction of member identity requirements, to reduce instances of fraud and illegal early release schemes.
The SMSF Preliminary Report is consistent with the Government’s Future of Financial Advice reform package, in particular,
in areas such as adviser competency and remuneration and the removal of the accountants’ licence exemption.
The Panel will make its final recommendations on SMSFs by 30 June 2010.
