Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 421

6 quick SMSF tips for the 2021/22 financial year

A new financial year always brings a new 'to do' list. With six weeks over already, we’ve put together a list of six tips that are worth checking.

Tip 1: Pensions often start early in the financial year. Don’t forget that if the member made personal contributions in 2020/21, the relevant notices about the deduction must be dealt with before the pension starts (a “Notice of Intent to claim or vary a deduction for personal super contributions” and the relevant acknowledgement from the trustee). In fact, if the pension started on 1 July 2021 it’s already too late to give this notice to the fund. The deduction will be denied.

A related issue is to think about these notices when a lump sum is paid from an account that received personal contributions in 2020/21. If a lump sum is paid before the notices are given, the deduction is reduced.

Tip 2: If a member is going to use the 'contribution splitting' rules to transfer some of their concessional contributions in 2020/21 across to their spouse, do this as early as possible. It means these contributions will be earning income in the spouse’s name rather than the account of the original contributor. And if the contributions being 'split' are personal contributions, the notices mentioned in Tip 1 need to be dealt with first.

Tip 3: Some people with more than one job can be in danger of exceeding their concessional contributions cap even if they never receive more than the minimum Superannuation Guarantee amount from each employer. People can now 'opt out' of Superannuation Guarantee contributions if they meet certain conditions. One of these conditions is that the relevant forms must be lodged at least 60 days before the first quarter to which it applies. 

Tip 4: Remember that the minimum pension amounts for 2021/22 are still only 50% of the usual levels. Clients who need the full normal minimum pension to meet their income needs could consider treating the excess over the minimum as a lump sum payment from their accumulation account or a partial commutation from their pension account. The best way to achieve this is to have documentation in place now – before the minimum pension payments are met – that request the trustee to treat the payments this way. This makes it abundantly clear to auditors and the ATO that all decisions about how to treat payments were made prospectively rather than backdated after the event.

This is exactly one of the moments when Tip 1 becomes crucial. If the payment ends up being a lump sum from the member’s accumulation account it will be vital that the notices about tax deductions for personal contributions have already been given to the trustee for the 2020/21 contributions.

Tip 5: Revalue the fund’s assets before the auditor asks you to. This is particularly relevant for funds with assets such as property where values can change during the year. A current market value will be needed for the 30 June 2021 financial statements and it’s much easier to get that as close as possible to the applicable date. Asking an agent (or trying to find your own external evidence) to value your residential unit as at 30 June 2021 when it’s already (say) April 2022 makes the job harder than it needs to be. Don’t forget the same rules apply to properties held within any unlisted companies or unit trusts in which the fund invests. Similarly, check things like lease agreements to see if rental payments made by the fund should be increased in line with CPI.

Tip 6: SMSFs owning bullion or similar assets will be familiar with the difficulties in proving to the fund’s auditor the existence of the asset at 30 June, particularly where it is stored in a private vault or deposit box with a bank. Often the auditor will ask for a photo of the bullion on top of a newspaper showing the date. Getting this evidence documented now will make the year end audit a lot simpler.

 

Meg Heffron is the Managing Director of Heffron SMSF Solutions. This is general information only and it does not constitute any recommendation or advice. It does not consider any personal circumstances.

 


 

Leave a Comment:

RELATED ARTICLES

Why it’s better to be a small investor

Latest SMSF updates from the ATO

Check tax exemption on income from super pension assets

banner

Most viewed in recent weeks

Pros and cons of Labor's home batteries scheme

Labor has announced a $2.3 billion Cheaper Home Batteries Program, aimed at slashing the cost of home batteries. The goal is to turbocharge battery uptake, though practical difficulties may prevent that happening.

Howard Marks: the investing game has changed

The famed investor says the rapid switch from globalisation to trade wars is the biggest upheaval in the investing environment since World War Two. And a new world requires a different investment approach.

Welcome to Firstlinks Edition 606 with weekend update

The boss of Australia’s fourth largest super fund by assets, UniSuper’s John Pearce, says Trump has declared an economic war and he’ll be reducing his US stock exposure over time. Should you follow suit?

  • 10 April 2025

4 ways to take advantage of the market turmoil

Every crisis throws up opportunities. Here are ideas to capitalise on this one, including ‘overbalancing’ your portfolio in stocks, buying heavily discounted LICs, and cherry picking bombed out sectors like oil and gas.

An enlightened dividend path

While many chase high yields, true investment power lies in companies that steadily grow dividends. This strategy, rooted in patience and discipline, quietly compounds wealth and anchors investors through market turbulence.

Tariffs are a smokescreen to Trump's real endgame

Behind market volatility and tariff threats lies a deeper strategy. Trump’s real goal isn’t trade reform but managing America's massive debts, preserving bond market confidence, and preparing for potential QE.

Latest Updates

Investment strategies

Getting rich vs staying rich

Strategies to get rich versus stay rich are markedly different. Here is a look at the five main ways to get rich, including through work, business, investing and luck, as well as those that preserve wealth.

Investment strategies

Does dividend investing make sense?

Dividend investing offers steady income and behavioral benefits, but its effectiveness depends on goals, market conditions, and fundamentals - especially in retirement, where it may limit full use of savings.

Economics

Tariffs are a smokescreen to Trump's real endgame

Behind market volatility and tariff threats lies a deeper strategy. Trump’s real goal isn’t trade reform but managing America's massive debts, preserving bond market confidence, and preparing for potential QE.

Strategy

Ageing in spurts

Fascinating initial studies suggest that while we age continuously in years, our bodies age, not at a uniform rate, but in spurts at around ages 44 and 60.

Interviews

Platinum's new international funds boss shifts gears

Portfolio Manager Ted Alexander outlines the changes that he's made to Platinum's International Fund portfolio since taking charge in March, while staying true to its contrarian, value-focused roots.

Investment strategies

Four ways to capitalise on a forgotten investing megatrend

The Trump administration has not killed the multi-decade investment opportunity in decarbonisation. These four industries in particular face a step-change in demand and could reward long-term investors.

Strategy

How the election polls got it so wrong

The recent federal election outcome has puzzled many, with Labor's significant win despite a modest primary vote share. Preference flows played a crucial role, highlighting the complexity of forecasting electoral results.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.