AUSTRALIA - Up to a third of self managed superannuation fund (SMSF) members do not recognise themselves as trustees and of those that do, 15% admit they don't have a good understanding of their obligations, new research shows.
The research by Australia’s largest accounting and finance group, CPA Australia, also found one third of SMSF owners did not have or did not know their funds’ investment strategy.
CPA Australia’s superannuation policy adviser, Michael Davidson, said SMSF trustees have a “much greater responsibility” than those who are in other funds and are ultimately responsible for the operation of their superannuation.
“Running a SMSF is serious business and there are a number of obligations SMSF trustees must meet under superannuation law,” he said.
“It is important they are fully aware of these. It’s not that they’re not making decisions or actively running their funds, our research indicates they’re just not fully aware of their legal obligations and their level of responsibility.”
Davidson said trustees who breach any of the requirements of the law could face significant penalties from the Australian Taxation Office ranging from fines to imprisonment.
The aim of the research was to provide a snapshot of the SMSF market, identifying reasons why SMSFs are established and the advice and services trustees seek from accountants or financial planners, CPA Australia said.
Some 600 SMSF owners, CPA public practitioners and financial planners were interviewed.
SMSFs are usually set up for control, flexibility, tax advantages, better returns and lower costs. Members are trustees and the funds’ are registered with, report to and are regulated by the Australian Tax Office.
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