Retirement may be the ultimate goal for most people, but what comes with it is the fact that you will no longer receive a steady income. The Government has taken many steps to encourage people to plan for possible retirement; the largest is the introduction of mandatory contributions for retirement savings in pension insurance during the working life of individuals in low-tax environments.
A popular old-age provision method is the Self-Managed Pension Fund (SMSF), which allows people to directly control and manage their retirement asset investments. For proper control of these funds, you should file SMSF excise return annually.
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However, many rules and regulations are governing the SMSF which in turn places a lot of responsibility on everyone who operates the SMSF and therefore may not be suitable for everyone.
The benefits of SMSF include:
SMSF offers a wider range of investment options than other pension funds. With a few exceptions, SMSF can invest in almost anything as long as it also passes the test for the sole purpose and complies with regulations. This also includes direct real estate investments.
Flexibility and control
Since fund members are also trustees, SMSF rules can be flexibly adapted to their specific needs and circumstances. This is not possible with other pension funds.
Effective tax management
SMSF has the same tax rates as other pension funds, but SMSF makes it easy for you to implement the tax strategy that works best for you and your situation.