Trouble signing in?
x
Menu

Tag Archive: SMSF

  1. Director ID – CALL TO ACTION

    Comments Off on Director ID – CALL TO ACTION

    Welcome to our latest newsletter, Director ID Edition, in which we remind you of an important deadline coming up.

    About Director ID

    All company directors are now required to apply for a Director ID.

    A director identification number (‘Director ID’) is a unique identifier given to a director who has verified their identity with Australian Business Registry Services (‘ABRS’).

    The Director ID system is designed to help prevent the use of false or fraudulent director identities.

    Note that it is a criminal offence if you do not apply for a Director ID by the deadline. ASIC is responsible for enforcing director ID offences set out in the Corporations Act 2001.

    Who needs to apply and when

    Any person that is a director of a company will need to apply for their own Director ID and they will keep that same Director ID forever.

    Exactly when you need to apply depends on when you became a director, as illustrated by the following table:

    Date you first became a directorDate you must apply
    On or before 31 October 2021By 30 November 2022
    Between 1 November 2021 and 4 April 2022Within 28 days of appointment
    From 5 April 2022Before appointment

    This means that if you were already a director of a company before 31 October 2021, you need to apply for your director ID as soon as possible as the deadline is 30 November 2022.

    How to apply for your Director ID

    The fastest way to get a Director ID is to apply online using the myGovID app. There is no fee, and you only need to apply once. Note that no one can apply for you, as you need to prove your identity when you apply.

    Step 1 (only necessary if you don’t already have myGovID set up)

    You need to set up a myGovID with a Standard identity strength which requires at least 2 of the following Australian identity documents to verify your identity:

    • Driver’s licence or learner’s permit
    • Passport (not more than 3 years expired)
    • Birth certificate
    • Citizenship certificate
    • Medicare card
    • Visa (using your foreign passport)
    • Immicard

    You can set up myGovID by downloading the app and following the prompts.

    If you do not have at least two of the documents listed above, then go to Step 4.

    Step 2 – Gather your documents

    Once you have set up your myGovID, you must have further information that the ATO knows about you in order to apply online for your Director ID. You will need:

    • Your tax file number
    • Your residential address as held by the ATO
    • Information from 2 documents to verify your identity (eg ATO Notice of Assessment, APRA fund account details, a dividend statement, a PAYG or a Centrelink payment summary)

    Step 3 – Complete your application

    Log in to ABRS online using your myGovID to complete your application (best to do this on your computer rather than mobile phone, but you need to have both devices, as a code will pop on the mobile that will need to be accepted). The process does not take long if you have already gathered your documents as per Step 2. The link is https://www.abrs.gov.au/director-identification-number/apply-director-identification-number

    Step 4

    If you are unable to set up myGovID, or you don’t have the required Australian identity documents to apply online, how you apply depends on where you live.

    If you live in Australia, you can call 13 62 50. Note that you will be asked to verify your identity.

    If you live outside of Australia, you can apply by using a paper application form:

    Application for a director identification number (NAT 75433, PDF 651KB).

    Once you have your Director ID

    Please contact us to provide your Director ID once you have it, and make sure that you keep the number in a safe place as this is a number that you will have for life.

    As always, don’t hesitate to contact one of the friendly Greenlight Super Services team members if you require further assistance on (02) 6273 1066 or info@glss.com.au.

    This newsletter is for general information only. Every effort has been made to ensure that it is accurate, however it is not intended to be a complete description of the matters described. The newsletter has been prepared without taking in to account any personal objectives, financial situation or needs. The information contained is correct as of 7 September 2022

  2. All Things Budget 2022

    Comments Off on All Things Budget 2022

    Welcome to our latest newsletter, Budget Edition, in which we consider the main items in the budget handed down on 29 March 2022 that may impact our super clients.

    Extension of the temporary reduction in super minimum draw down rates

    The Government has extended the 50% reduction of the superannuation minimum drawdown requirements for account-based pensions and similar products for a further year to 30 June 2023. The minimum drawdown requirements determine the minimum amount of a pension that a retiree must draw from their superannuation to qualify for tax concessions.

    Given ongoing volatility, this change will allow retirees to avoid selling assets to satisfy the minimum drawdown requirements.

    Based on this change, the effective reduced minimum percentage factors for account-based pensions (‘ABPs’) (including Transition to Retirement Income Streams (‘TRISs’)), are set out in the following table for the 2023 income year.

    Note that, for ABPs and TRISs that commence or cease part-way through the 2023 income year, a pro-rated minimum pension payment applies (unless the pension commenced on or after 1 June 2023, in which case, no minimum pension payment is required).

    Recipient’s ageMinimum percentage factor  Reduced minimum percentage factor
    Under 654%2%
    65 to 745%2.5%
    75 to 796%3%
    80 to 847%3.5%
    85 to 899%4.5%
    90 to 9411%5.5%
    95 and above14%7%

    Cost of living payment

    This consists of a $250 economic support payment to help eligible recipients with higher cost of living pressures. The payment will be made in April 2022 to eligible recipients that receive payments

    such as the age pension, the disability support pension, the Eligible Veterans’ Affairs payment, or that hold a concessional card such as the Pensioner Concession Card (PCC), the Commonwealth Seniors Health Card, or the Veteran Gold card (note that this is not an exhaustive list).

    Increase to low and middle income tax offset (‘LMITO’)

    The Government has announced a one-off $420 cost of living tax offset for the 2022 income year for those with income under $126,000, which will be provided in the form of an increase to the existing LMITO. This will increase the maximum LMITO benefit to $1,500 for individuals and $3,000 for couples and will be paid from 1 July 2022 when Australians submit their tax returns for the 2022 income year.

    Temporary reduction in fuel excise

    Higher fuel prices will be temporarily reduced by halving the excise rate that applies to petrol and diesel for six months. The current rate of excise is 44.2 cents per litre and will reduce to 22.1 cents per litre under this measure, which is to commence from 12.01am on 30 March 2022.

    As always, don’t hesitate to contact one of the friendly Greenlight Super Services team members if you require further assistance on (02) 6273 1066 or info@glss.com.au.

    This newsletter is for general information only. Every effort has been made to ensure that it is accurate, however it is not intended to be a complete description of the matters described. The newsletter has been prepared without taking in to account any personal objectives, financial situation or needs. The information contained is correct as of 31 March 2022

  3. Happy Financial New Year 2022!

    Comments Off on Happy Financial New Year 2022!

    Welcome to our latest newsletter, End of Financial Year Edition, in which we provide you with a brief checklist of items to consider.

    Contributions

    A brief reminder of some of the types of contributions you may have the opportunity to make by 30 June 2022:

    • Concessional contributions up to $27,500 pa;
    • Non-concessional contributions (so long as Total Super Balance at 30 June 21 is less than $1.7m) – the cap is $110,000 pa;
    • Access the bring forward rules – up to $330,000 if eligible;
    • Access unused concessional contributions (30 June 2021 Total Super Balance must be less than $500,000)
    • Spouse contributions (rebate maybe applicable);
    • Contributions using the one-off work test exemption (30 June 2021 Total Super Balance must be less than $300,000).

    Pensions

    It is important for members to reconcile all pension payments received from their SMSF retirement income streams since 1 July 2021 to ensure that there is no underpayment of the minimum pension payment required to be taken by 30 June 2022. If members do not withdraw the minimum pension required, then the SMSF will lose some or all of its tax exemption, and the relevant pension account will have to be rolled back to accumulation mode.

    If you are unsure what your minimum pension requirement is, please contact us so that we can assist you in this regard. We are working through every fund to check in on this as we speak.

    Valuations

    It is a requirement that all SMSF assets be valued at market value for reporting purposes. Whilst this is a simple process for listed securities, it can be quite complicated and time consuming to determine the market value of unlisted investments.

    We recommend that all SMSFs that have either direct property or indirect investment in property via unlisted structures commence the process of getting updated market valuations as soon as possible so that the 2022 year end work is not held up. To note this does not have to be formal valuations but must be based on comparable sales data.

    Some important changes from 1 July 2022

    Contributions

    • Individuals up to the age of 75 will no longer have to meet a work test to make voluntary, non-deductible contributions;
    • The bring forward rule will be extended to individuals up to the age of 75;
    • The minimum age to make downsizer contributions will reduce to 60.

    work test

    Currently, a member aged 67 to 74 can only make voluntary contributions to super if they have worked at least 40 hours over 30 consecutive days in the financial year. This work test must be met prior to them contributing.

    From 1 July 2022, this work test will only apply to a member who wants to claim a tax deduction on voluntary contributions made to super. This means that the work test will no longer apply to any of the following contributions:

    • Non-concessional contributions
    • Spouse contributions
    • Salary sacrifice contributions

    Further, where a member does make personal deductible contributions, they will be able to satisfy the work test at any time in the financial year.

    miscellaneous

    • The Superannuation Guarantee rate will increase to 10.5% pa;
    • The $450 minimum monthly threshold to be entitled to received Superannuation Guarantee will be removed;
    • Under the First Home Super Scheme eligible individuals will have access to an extra $20,000 of voluntary contributions to fund a home deposit (an increase from $30,000 to $50,000).

    As always, don’t hesitate to contact one of the friendly Greenlight Super Services team members if you require further assistance on (02) 6273 1066 or info@glss.com.au.

    This newsletter is for general information only. Every effort has been made to ensure that it is accurate, however it is not intended to be a complete description of the matters described. The newsletter has been prepared without taking in to account any personal objectives, financial situation or needs. The information contained is correct as of 6 June 2022

  4. February 2022 update

    Comments Off on February 2022 update

    Welcome to our first update for 2022, in which we outline the key super measures that have recently been passed by both Houses of Parliament. Once Royal Assent is given, most of these changes will apply from 1 July 2022

    Changes to the Work Test

    The work test requires individuals over the age of 67 to be gainfully employed for a minimum of 40 hours in a 30-day consecutive period. This definition has not changed – what has changed is when the work test needs to be applied.

    The rules for members aged 67 to 75 are essentially as follows:

    Current RulesNew rules from 1 July 2022
    Members wishing to make personal deductible contributions must satisfy the work test.No change to this rule.
    Members must satisfy the work test in order to be able to make non-concessional contributions up to the annual cap of $110,000 or to make salary sacrifice contributions.The work test no longer needs to be satisfied to make non-concessional contributions up to the annual cap of $110,000 or to make salary sacrifice contributions.

    Note: that there are no changes to the contribution rules for members over the age of 75 – they can still only receive mandated contributions (generally the Superannuation Guarantee amount of 10% or some other amount as dictated by an industrial award).

    At this point, it may be worth the reminder that from 1 July 2021 the concessional contributions cap increased from $25,000 to $27,500, and that the non-concessional contributions (‘NCCs’) cap increased from $100,000 to $110,000. Eligibility to make NCCs is still subject to being below the Total Superannuation Balance cap as at the 30 June prior (the cap was $1.6m up to 30 June 2021, $1.7m from 1 July 2021).

    Bring Forward Rules

    Removing the work test for NCCs has the flow on effect of extending the opportunity to use the bring-forward provisions. What this means is that members up to the age of 75 (previously 67) are now eligible to make use of this provision.

    There is no change to the fact that an individual’s capacity to make use of this rule is impacted by their Total Superannuation Balance – as per the following table:

    Total Superannuation BalanceNCCs and bring forward available
    (from 1 July 2021)
    Less than $1.48 million3 years ($330,000)
    $1.48 – < $1.59 million2 years ($220,000)
    $1.59 – < $1.7 million1 year ($110,000)
    $1.7 million or moreNil

    Downsizer contributions

    The eligibility age to make downsizer contributions will reduce from 65 to 60 years of age.

    The two most significant issues with reducing the age of eligibility are:

    • that anyone who contributes prior to the age of 65 will have to meet a condition of release to access the benefit; and
    • those who use it early will need to consider how the contribution impacts other contribution strategies (an individual’s capacity to make a downsizer contribution is not impacted by their Total Superannuation Balance, whereas the capacity to make non-concessional contributions is, so careful planning may be required).

    Other measures

    Exempt Current Pension Income (‘ECPI’)

    Trustees will be able to choose their preferred method of calculating ECPI (proportionate or segregation) when they have member interests in both accumulation and retirement phases for part, but not all, of the income year.

    Unlike all the other measures passed, this one comes into effect from 1 July 2021.

    First Home Super Saver Scheme (‘FSSS’)

    The maximum allowable withdrawal that can be made under the FHSSS will increase from $30,000 to $50,000 for anyone that requests a determination from 1 July 2022. More information about the scheme can be found here.

    Superannuation Guarantee Eligibility – Income Threshold Removed

    The $450 per month income threshold under the which employees do not have to be paid the superannuation guarantee by their employer will be removed. This is expected to improve equity in the system for casual and part-time workers.

    As always, don’t hesitate to contact one of the friendly Greenlight Super Services team members if you require further assistance on (02) 6273 1066.

    This newsletter is for general information only. Every effort has been made to ensure that it is accurate, however it is not intended to be a complete description of the matters described. The newsletter has been prepared without taking in to account any personal objectives, financial situation or needs. The information contained is correct as of 17 February 2022.

  5. Director identification number

    Comments Off on Director identification number

    Australian company and SMSF directors can now register for the new director ID.

    A director ID is a unique 15-digit identifier given to a director who has verified their identity with the Australian Business Registry Services and will help to prevent the use of false or fraudulent director identities. Directors will keep the same director ID for life. There is no charge.

    To apply, directors must log in to ABRS online using the myGovID app and the Director ID is issued instantly once the identification process has been completed. You will need a myGovID with a Standard or Strong identity strength to apply for your director ID online. It is possible to apply via the telephone or via paper, should you need to.

    When do you need to apply by?

    For all existing directors appointed prior to 31 October 2021:

    They will have a deadline of 30 November 2022 to apply for a DIN.

    For new directors:

    • Between 1 /November 2021 and 4 April 2022, new directors have 28 days to apply for a DIN after being appointed as a director.
    • From 5 April 2022, all directors will be required to apply for a DIN prior to being appointed as a director.

    Please note that directors must personally register for their DIN, meaning that we are unable to do this for you. We can, however, assist you by providing you with your Tax File Number if you cannot locate it, or by helping you understand the process.

    You can apply online or access further information through the Australian Business Registry Services website available here.

    As always, don’t hesitate to contact one of the friendly Greenlight Super Services team members if you require further assistance.