Family trust may become new SMSFs
The Federal Government's proposed changes to superannuation in the 2016 Federal Budget (‘ScoMo' changes') may amount to the demise of self-managed superannuation funds (SMSFs) as the preferred private wealth investment vehicle, according to SuperCentral.
Although the SMSF service provider said that this view might be "overstating the situation", it also stressed that tax deductible contributions could only be made to superannuation funds and not to family trusts.
According to SuperCentral, the tax rates that were at 15 per cent and 10 per cent respectively during the period before retirement and subject to zero tax in retirement, would generally be more advantageous for most family groups than the normal marginal rates even with the zero rate threshold.
Also, the controllers of the superannuation fund were not required to have to distribute the income to beneficiaries to avoid taxation at the top marginal rate.
"While the significant ScoMo changes are negative (the less significant changes are generally beneficial), they have not entirely eroded or neutralised the taxation benefits of superannuation," SuperCentral said.
AUTHOR
Oksana Patron
Recommended for you
Data and technology provider Novigi has acquired Iress’ superannuation consulting and managed services business from Apex Group.
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
