SMSF owners could be lumping beneficiaries with tax liabilities

SMSFs/capital-gains-tax/capital-gains/

20 July 2009
| By Corrina Jack |

Self-managed super fund (SMSF) owners could be lumping their beneficiaries with tax liabilities that amount to tens of thousands of dollars, according to Lifeplan Funds Management.

The capital value of a whole death benefit paid to a beneficiary may be subject to tax, Lifeplan national adviser solutions manager Alison Massey said.

“There is a misconception that only income is taxed,” she said.

Lifeplan advised that those most affected were SMSFs which have reached the pension phase of paying out funds. While SMSFs are exempt from capital gains tax (CGT), the exemptions end when the last member of the fund dies, Massey said.

Lifeplan’s NextGen Investments, however, removes the 'death duty' that applies to funds transferred to non-dependents from a SMSF.

It enables beneficiaries to fund the tax liability if assets are held by the SMSF, thereby not requiring a forced realisation of assets.

Lifeplan said there are about 2,500 new SMSFs set up every month with an average balance of $454,000.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

3 months ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

5 months ago

ASIC has suspended the Australian Financial Services Licence of a Melbourne-based financial advice firm....

2 weeks 4 days ago

The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered....

3 weeks 2 days ago

ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test....

4 weeks ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
93.34 3 y p.a(%)
2
5
Plato Global Alpha A
28.73 3 y p.a(%)