SMSF – insurance
The SIS Act changed to require, for the 2012-2013 financial year and beyond, that:
- 1. trustees of self managed superannuation funds (SMSFs) consider insurance for their members as part of the fund’s investment strategy;
This does not mean that life insurance must be included in every Fund but it does mean that the Investment strategy should show that the matter has been appropriately considered.
- 2. money and other assets of an SMSF be kept separate from those held by a trustee personally and by a standard employer-sponsor or an associate of a standard employer-sponsor;
This has always been the case but is now an operating standard which gives the ATO greater enforcement powers.
- 3. SMSF assets be valued at market value for reporting purposes.
This formalises a previous ATO guideline that we have always abided by.
Given that points 2 & 3 should already have been in place for most Funds it will be the need to consider life insurance which will cause the most activity as the majority of Fund investment strategies will probably require alteration. Auditors will require that Investment Strategies comply.