ContinuumFP eNewsletter June, 2016
- a 5-minute read before links
The end of the financial year is fast approaching. You knew that already of course – if only because all the EOFY Sales advertising on TV, print media and the radio.
This year we have a special run down to EOFY – a Federal election! Whatever your political persuasion, we encourage all eligible voters to use their voting privilege effectively – and wisely.
At this time of year, most of us are looking for any matters that need to be attended before the 30 June date rolls around: in this eNews, we’ll try to cover off as many as are relevant from a financial planning point of view as we can (and Superannuation is a big one this year).
Before we get into those topics however, a gentle reminder that we are quite happy for you to share these newsletters with family and friends (and for you to encourage them to go to our website and sign in to receive their own copy directly. We promise not to hassle them with any form of general marketing, nor to provide their email address to any third party).
EOFY reminders:
Superannuation
If you are making a nonconcessional contribution to your super account before the year ends, you will need to ensure that the amount contributed does not take you over the lifetime cap announced in the 2016 Federal Budget. That cap is $500,000 (nonconcessional – that is, non-tax deducted) since 1 July 2007.
If you are making concessional contributions (that is, tax deductible) before the end of the financial year, you need to ensure that the total contributed for the year doesn’t exceed your age-based cap: for those under 50 years of age, the cap is $30,000; for those over 50 years of age as at 30 June 2016, the cap is $35,000.
Regardless of whether you are contributing a concessional or a nonconcessional amount, the payment MUST be received by your trustee by 30 June 2016. Some superannuation funds have close off dates as early as 25 June so as to ensure proper processing.
Employers paying superannuation guarantee contributions have the legal capacity to pay a complying superannuation guarantee amount for the pay periods to the end of June, by 28 July. Please note that whilst this will comply with the SIS legislation, that payment will not be tax deductible for the business until the year in which it is paid. (You may also be disadvantaging your employees who are relying on their sga contributions to maximise their use of the contribution cap applicable to them.)
Income Protection Insurance premiums
Premiums for this insurance are tax deductible in most circumstances. If you have a policy due around this time, you will only be able to claim the premium as a tax deduction for the 2016 year, if you have paid the premium before the close of business on 30 June.
Self-managed superannuation fund members and trustees
Superannuation contributions:
Note that the information under the Superannuation section above is relevant to you. If we can be of any help in reviewing your situation in this regard, please contact your adviser at our office.
Investment strategy:
Each year the trustees of an SMSF are required to review the investment strategy of the fund and ensure that:
- The assets held in the fund are held according to the documented strategy;
- The strategy continues to be relevant in the circumstances in which the fund is operating (including the circumstances of the individual members);
- The investment performance is progressing toward the goals and objectives set; and
- Any insurance needs of the fund and its members have been appropriately considered.
We may be able to assist you with these matters: and your administration team (including your auditor) will be looking to see that you have taken all actions compliant with the legislation and regulations applicable.
Housekeeping:
Trustees will need to ensure that the Fund’s Trust Deed is ‘up-to-date’ with current legislative and taxation requirements; that all assets held are compliant with the recently changed rules regarding various classes of assets (particularly collectibles, art works, etc); and that decisions of the trustees have been appropriately documented.
Tax deduction and business compliance matters
You should watch out for information from your tax agent for matters that require your attention before the end of the financial year. They will include items such as:
- Inventory management (writing off obsolete stock);
- Debtor management (making appropriate provision for bad debts);
- Bonus declarations (payment may be made subsequently in certain circumstances);
- Various notifications, declarations and elections (mostly to or in respect of taxation matters, but including trustee resolutions); and
- Prepayments (in relevant and appropriate circumstances).
Tax preparation checklist
Your accountant/ tax agent will probably provide you with a checklist of items that you should be preparing for the time when they will be calling on you to provide information for them to use to prepare your tax return. Amongst the items they'll be looking for, will be details of income received from investments (and in some cases, the balances in various investment accounts at year’s end). We can provide this information to them for you, in relation to investment accounts we manage on your behalf.
Please contact Kathy at our office (phone: 0734213456) if you would like us to provide the above data items directly to your accountant once they become available. She will want to know the name and contact number or address for your accountant/ tax agent.
If you are a self-preparer and would like a checklist of items to be getting ready for when you will need to prepare your return to the ATO (whether lodging a paper return or using the MyGov site to lodge electronically), Kathy will also be able to help you with this from around mid-July.
Annual Tax Statement
Those of you who are employed (and some of you who receive pensions and other benefits from various sources) will be receiving Annual Tax Statements in the near future: these are important documents and WILL be needed for the preparation of your tax return. Watch out for them – and you should then file them in a safe and accessible place.
…now moving on to some more general matters:
Insurance Claims
From time to time we hear from clients that they are sceptical that insurance companies pay claims when the time comes that they need to rely on the payment expected. Whilst we are very confident of the system that operates with the insurers that we use for our clients, it is also helpful to be able to affirm our confidence with reports like the one recently released by AIA showing the amount of claims paid by them during the 2015 calendar year. (It is linked under this title: AIA Retail Claims Brochure 2016.)
ContinuumFP Services
We’ll resume our detailing some of the services that are not well known in the July eNews: they are focused around superannuation and insurance topics and we recognise that this eNews has enough on those topics already.
ContinuumFP website
We continue to refresh existing articles and to watch out for topics that we consider you might find informative and interesting. If you have any suggestions for update to any of the articles you read on the website, or would like to see a particular topic covered, please feel free to email us directly, or complete the Contact Us form on our website with your request.
Some articles that we have recently refreshed, include:
Budget Summary 2016
We haven’t published our regular budget summary this year because of the double dissolution election that loomed: when the election results are known, we will publish an update on what we believe the consequences for the 2016 Budget presented on 3 May 2016 will be.
We wish you well for a successful year coming to an end: and for a stable government to be formed.
The Continuum Financial Planners' Team
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Continuum Financial Planners Pty Ltd is a Corporate Authorised Representative of Securitor Financial Group Limited ABN 48 009 189 495 | AFSL 240687 Level 8, 260 Queen Street, Brisbane QLD 4000
