Andy Forbes

Enterprise Self-Managed Superannuation Fund (SMSF) software administration provider, SuperConcepts, has released a trustee dashboard innovation called SuperMate Client View.

Firms using SuperMate can now offer SMSF clients a refreshed user experience that provides fund trustees with access to key information as well as an all-new communications channel for faster, end-of-year technical query completion.

SuperMate Client View is an enterprise-grade and mobile-first solution that builds on the software’s ability to simplify SMSF, Small APRA Fund and portfolio administration management. The new Client View ensures users stay connected and informed about their SMSF, offering a streamlined approach to trustee engagement.

Andy Forbes, Chief Technology Officer at SuperConcepts, explained the user-centric design philosophy of SuperMate: “Our software is built with the end user in mind, originating from decades’ fine-tuning what and how trustees want to view their data. Designed for administrators, accountants, and advisers, the software simplifies SMSF administration with its intuitive interface, thoughtful design, and cutting-edge features, such as automated compliance checks, integrated reporting, and robust data analysis tools.”

“The new Client View empowers administrators using SuperMate to grant end trustees a personalised SuperMate login and commanding dashboard that expedites the end-of-year lodgement process through efficient query handling,” Forbes said.

This announcement follows a series of impactful updates and enhancements in 20 software releases and over 250 developments since SuperMate’s acquisition from AMP in June. Spearheaded by a hand-picked management team with deep SMSF experience, the revitalised SuperConcepts has made it a priority to improve technology-driven client outcomes.

Matthew Rowe, Chief Executive Officer, SuperConcepts, stated: “The introduction of SuperMate Client View demonstrates our commitment to better serve our clients as a privately-owned business, providing subscribers with a comprehensive tool to inform, engage, and streamline the end-of-year query process.”

Forbes shared the team’s vision for SuperMate and what is next for the software: “Our team of specialists is working on improved corporate actions, broker feeds, workflow and a pilot of ACSISS Adviser for massively extended bank feeds. The commitment to innovation is unwavering, promising an even more robust suite of features for users.”

“SuperMate is not just a software solution; it’s representative of industry change. We believe in more Australians taking control of their superannuation through SMSFs, and accountants using SuperMate are helping make this vision a reality.”

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With over 25 years of experience in the accounting, tax and superannuation industries, Craig has established himself as a respected specialist in the SMSF space. Prior to joining SuperConcepts, Craig served in senior positions at leading accounting firms, most recently having managed accounting and tax strategy of SMSFs at Hood Sweeney.

In his Adelaide-based new role, Craig will work closely with the company’s experienced and well-regarded management team, consisting of Matthew Rowe, Managing Director, along with Chief Operating Officer, Brad Ackermann, and Executive Director of Client Services, Andrew Row. He is responsible for the oversight and management of the delivery of SMSF technical services to internal and external stakeholders, including trustees, advisers, and accountants.

Matthew Rowe reinforced the value in the addition of Craig, who began his tenure with SuperConcepts in August.

“We are thrilled to welcome Craig to the SuperConcepts team, and his appointment speaks to our focus on talent investment: bringing in people who have the expertise, skills and capacity to help us think differently about the future and build the business accordingly,” Rowe said.

“Craig is uniquely skilled at enabling the complex subjects of superannuation to be understood in a simple manner, and already in his short time at SuperConcepts he has led several client education-driven initiatives.

As someone both highly experienced and highly accomplished in his field of expertise, I am confident that Craig will make significant contributions in our ability to simplify SMSF to enable more Australians to control their super.”

On his new role, Craig commented: “I’m very excited to be a part of the dynamic team at SuperConcepts, all driven by the same goal: to increase quality outcomes to enhance customer’s SMSF experience.”

“As we witness a growing market demand for self-administration options beyond traditional superannuation funds, SuperConcepts provides an exciting opportunity to take part in a technology-led industry shift to empower more Australians.”

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Andy Forbes

Specialist SMSF administration software provider SuperConcepts has selected ACSISS, by SISS Data Services, as Open Banking partner for their SMSF and Portfolio administration solution, SuperMate.

Open Banking is a legislated initiative that requires Australia’s banks give consumers the option to share their data with accredited third parties. Open Banking is designed to increase competition in the financial services sector, promote innovation and provide consumers with more control over their personal and financial data.

“We’re really excited about the potential of Open Banking and how it will make the SMSF data feed establishment process much easier for everyone involved – from administrators to trustees.” Andy Forbes, Chief Technology Officer at SuperConcepts

Established in 2011, SISS Data Services is Australia’s largest independent provider of secure, customer-consented, bank-approved data; offering both direct data feeds from leading retail banks and open banking access as an Accredited Data Recipient under the Consumer Data Right (CDR).

“ACSISS My Data, our secure data solution, enables consumers to share their transaction data from around 100 banks and financial institutions with their trusted advisers, without sharing their banking passwords.  Accountants and advisers with SuperMate, will soon be able create an automated, daily data feed from ACSISS Adviser into SuperMate,” Grant Augustin, Managing Director at SISS Data Services.

The integration of ACSISS in SuperMate later this year will streamline data feed establishment as well as expanding on the breadth of the 260+ integrations already available.

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Andy Forbes

Leading SMSF administration, education, and software solutions provider, SuperConcepts, has announced a new pricing structure for their self-managed super accounting software, SuperMate.

SuperMate’s new pricing brings all the great features of the newest SMSF administration system on the market and some key data feeds for just $11 per month or $132 ex GST per fund per year.  The data feeds included are Macquarie Cash via ESI, Broker Contract Note service and registry holdings lookups from Link, Computershare and Boardroom.

“We built this share pack into our base price as we want all our customers to benefit from the efficiencies of contract note data and registry feeds” Forbes said.

Included at this price point are all SuperMate’s great features such as SuperStream ESA, Foreign Assets, Data Hero^TM for drag and drop bank statement transaction extraction, our time saving property worksheets, improved crypto processing and more.

Funds requiring a broader set of data feeds can make use of the data feed bundle for an additional $4.75 per fund per month, ex GST.  Resisting inflationary pressures, this brings the top rate for the new SuperMate to $15.75 per month or $189 ex GST per fund per year, a small reduction on the previous rate of $190.

“Most firms will have funds across both price points, so this new tier makes the innovative, new SuperMate even more attractive for those considering switching, as well as bringing savings to existing users” Forbes said.

Existing clients will see the new pricing changes in the upcoming May billing, for the April charges.

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Andy Forbes

Specialist SMSF administration software providers SuperConcepts and Smarter SMSF have announced an integration between SuperMate and the Smarter SMSF documentation platform.

During a recent webinar, Andy Forbes, SuperConcepts Chief Technology Officer and Aaron Dunn, CEO of Smarter SMSF, demonstrated the integration now available to SuperMate clients. “We’re thrilled about this integration and there’s more on the horizon that will leverage the full power of the SuperMate API. Having an easy, frictionless way to order documents is fantastic for our mutual clients,” Forbes said.

The integration allows SuperMate users to link their site to Smarter SMSF’s platform, view their clients and generate from an initial range of SMSF documents. These documents will be pre-filled with the data from SuperMate, reducing manual data entry errors and saving accountants’ valuable time.

“We are excited about the launch of our new partnership with SuperMate. Through the API, users can now seamlessly order documents, including deed upgrades, pensions, and investment strategies. The functionality enables users to automatically set up a new SMSF into SuperMate, which also incorporates our new ABN/TFN integration,” mentioned Dunn.

In the webinar, Forbes and Dunn also discussed the future of the integration, including more document types and pushing both data and documents automatically from Smarter SMSF into the SuperMate system.

According to Aaron, “we see some fantastic opportunities ahead with this two-way integration. With an ever-growing number of documents on the platform, accessing the SuperMate integration will save significant time for SuperMate users, leveraging the expertise built into Smarter SMSF’s suite of documents.”

Users of both the new SuperMate and the older desktop based SuperMate Classic can take advantage of this integration today.

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Nicholas Ali

The Consultation Paper has just been released on the Labor Government’s proposed changes to the tax concessional treatment of superannuation. These proposed changes have caused much consternation amongst those involved in the SMSF sector. Reading articles, the comments section to articles and direct discussions with trustees and intermediaries, one gets the feeling the proposals have confused people greatly.

I’ve even read an article where divorce is recommended to even up member accounts prior to 1 July 2026!

There are several things that need to be mentioned regarding Labor’s announcements.

The changes are just proposed

The first issue to point out is these are incomplete proposals. The Consultation Paper makes this abundantly clear. For example, determining the value of a member’s defined benefit interest for Total Super Balance (TSB) purposes, earnings on defined benefit interests and how to tax defined benefits in excess of the $3m cap are all in their infancy.

There is a lot that needs fleshing out to make these proposals even remotely workable.

Governments often cast the policy net out as far as they can, knowing they will have to drag it in eventually – either a lot, or a little. There have been many issues raised with the proposals, so the government consultation period will be a rich source of food for thought our policymakers can nourish themselves on. What is the final legislative piece may well differ markedly from what is on the table currently.

The start date is a few years away

Whatever the proposal ends up being, it won’t be until the 2026/27 financial year that the tax penalty will be determined. Even then, it won’t be paid by super funds until sometime in the 2027/28 financial year.

There is also a Federal Election some time in the 2024/25 financial year, so if the changes are not what the electorate desires, then people are free to vote against them. One might remember Labor’s changes to franking credit policy prior to the 2018 Federal Election that never saw the light of day due to them never forming government.

There are strategies to reduce the impact of the tax

Even if the proposals pass into legislation unfettered, there are multiple strategies to reduce the impact of the extra tax.

Firstly, equalisation of member accounts will become an essential part of super planning. If one member has, say, $4m and their spouse $1m, then the option should be to even up their accounts as best as possible using a re-contribution strategy. Now that the work test has been abolished, members can make non-concessional contributions up to age 75, including making use of the bring-forward provisions (subject to the TSB and contribution caps).

Secondly, there are other structures that can assist those who will be impacted by the extra tax. Family trusts allow income to be streamed to a multitude of beneficiaries on lower marginal rates of tax (including corporate beneficiaries). Yes, this means withdrawing funds from super and creating a new tax structure but, given the higher rates of tax in the super environment, it might be time to look at this option.

Also, monies can be withdrawn from a member account and then re-contributed back to super for other family members (subject to the member’s TSB and contribution cap limits). This can be done to build super for the next generation (a form of pre-death estate planning if you like). Whilst their account balances may be preserved for some time, this is one way to avoid the 15% extra tax on earnings and any lump sum death benefits tax on the taxable component.

Finally, given people were encouraged to save for their retirement through super, many do not utilise the generous tax-free thresholds afforded to individual taxpayers. Investing in personal names could be a sound strategy, as it also avoids lump sum death benefits tax.

One of the complaints from Government has been super is being used too much as a wealth transfer vehicle, rather than a retirement income stream vehicle. What is proposed could well have the opposite effect – people will plan the transfer of wealth from one generation to the next far more judiciously than ever before. And they will make sure they pay as little tax as possible along the way.

Superannuation will still be the best

A Financial Review article (dated Wednesday, 29th of March 2023) includes BDO analysis showing that even with the proposed changes, superannuation will still be the best retirement vehicle we have.

Whist not as attractive as before, super will still form the backbone of retirement savings for most Australians. They will just have to weigh up whether it will be the only retirement vehicle for consideration, or as part of a suite of investment options and vehicles.

Concluding thoughts

The changes proposed by the Labor Government have the potential to use policy settings that have long-term retirement savings consequences for all future Australians to target a small group of wealthy boomers in the short term.

And the changes will be wonderful for the accounting, legal and financial planning industries. Strategic advice will become more important than ever before.

By Nicholas Ali, Executive Manager, SMSF Technical Support

The post Musings on the $3m cap consultation paper appeared first on AdviserVoice.

Philip La Greca

On 28 February 2023 a joint press release from the Federal Treasurer & Assistant Treasurer announced a proposal to impose an extra tax on superannuation benefits of more than $3 million from 1 July 2025. The release was followed by a factsheet from the Treasury on how the proposed measure would work.

The new 15% tax will impact anyone who has a Total Superannuation Balance of more than $3m which is not indexed.  The tax is in addition to any tax their superannuation funds pay on earnings in accumulation phase. As a result, earnings linked to balances above $3 million will generally be subject to a combined headline rate of 30%.

Individuals will have a choice to pay the tax out of pocket or draw from their superannuation funds. If an individual is a member of more than one superannuation fund, they can choose which fund will pay the tax.

The announcement has stirred an uproar in the industry as an unindexed cap of $3m  is estimated to impact more than the 80,000 individuals when the extra tax commences in 2025.

History repeats

Of course, this not the first time we have had hard/soft caps on superannuation benefits. In the past, limits applied to benefits which were linked to a person’s salary and if too much had been accrued then any income earned on the excess was taxed at the top marginal tax rate.

The superannuation changes in 2007 abolished both compulsory cashing of benefits and penalty taxes on excess benefits. From 1 July 2007 pension payments that were previously taxed up to 49% became tax exempt and could commence at the option of the individual. This continued with the 2017 super changes, however, a Transfer Balance Cap (TBC) was introduced to regulate the amount that could be used to commence pensions in retirement phase.  Any amounts in excess of the TBC were allowed to remain in the fund until the individual’s death.

How is it calculated?

The new 15% tax is not an increase on the tax rate on the individual’s taxable income. Instead, the tax applies to a portion of the individual’s earnings on their superannuation balance.

The calculation has 3 components:

An example (from Treasury factsheet)

Scenario: Louise is 40 and working. At 30 June 2026, she has a balance of $2 million in an APRA-regulated fund, and a balance of $3 million in an SMSF. At 30 June 2025, the balance of her APRA-regulated fund was $1.9 million and the balance of her SMSF was $2.9 million. She does not meet a condition of release, so she has no withdrawals during the year. She makes $20,000 of concessional contributions into her SMSF. Her contributions net of tax on contributions is $17,000.

Calculation:

Louise elects to pay $5,000 from her APRA-regulated fund and $5,980 from her SMSF.

The additional 15% tax will not be calculated by each superannuation fund but is assessed by the ATO after all TSB data is lodged. This could mean an earlier SMSF lodgement date, as there will be an incentive for funds to lodge as late as possible to defer the payment of the extra tax.

Unrealised Capital Gains

The calculation of an individual’s TSB has always included unrealised capital gains as a member’s balance includes the market value of the investments on 30 June. The are several other important rules using unrealised gains which are incorporated in TSB – notably the rules for bring forward non-concessional contribution and carry forward concessional contributions.

Given the use of TSB for purposes of the new tax, SMSFs could move towards using tax effective accounting to incorporate a tax provision on unrealised capital gains.  This may lower the member’s balances in the fund and ensure any of the “excess” tax applies only on net capital gains. The use of tax effect accounting may bring SMSFs into alignment with APRA funds which are required to ‘mark to market’ and provide for future capital gains tax.

The alternative could be to exclude unrealised capital gains from member balances.  In doing so some form of unallocated reserve would need to be created and appear in the fund accounts.  This would allocate capital gains to a member’s balance only after they have been realised. However, allocation in this way would be inequitable to those members who joined prior to the acquisition of an asset and have left the fund before it has been sold.

Unrealised capital gains are also used in calculating unit prices for practically all the unit trust investments by superannuation fund. There are various existing fees and charges imposed by the state governments and private sector businesses that use market values which include unrealised capital gains.

For most of the affected individuals who meet a condition of release there are no restrictions under the superannuation rules to withdrawing amounts from superannuation. The downside appears to be the crystalisation of unrealised capital gains as the fund needs to take the tax liability into account for any withdrawal including in-specie transfers otherwise the calculation of the TSB is distorted.

Other matters to consider include:

• pension payments in the calculation of the net withdrawal seem a little inappropriate given some of those withdrawals, such as compulsory minimum pension payments, are not voluntary, whereas most contributions received by the fund are voluntary,
• clarification of the definition of net contributions, and whether adjustments to concessional contributions include the notional 15% tax rate irrespective of the super fund’s effective tax rate,
• whether an exception will continue for structured settlement payments, as they are currently excluded from TSB calculations, and
• the headline rate of 30% in some ways claws back some of the $3.3 billion in franking credits received by the SMSF sector which according to the ATO stats for 2020 resulted in a $1.4 billion tax benefit.

Possible improvements to the current proposal

1. The clear focus of the proposal is on accumulation accounts particularly as the 2007 changes meant they have been able to sit in superannuation post age 65 and grow with concessionally taxed earnings. The lack of indexation of the $3 million cap could result in more people being caught by this measure, as member balances grow.
2. Bring back a compulsory cashing point, that is an age at which superannuation monies must be accessed, or introduction of a mandatory pension age. This could apply from age 75, when most contributions to super effectively cease. Pensions would be subject to TBC limits and statutory drawdown rates.

This measure will not commence until the 2025-26 financial year, which will hopefully provide plenty of time to achieve the right intended outcomes, so in the words of Douglas Adams – DON’T PANIC.

By Philip La Greca, Executive Manager SMSF Technical and Strategic Solutions

The post The $3 million dollar question – hard or soft cap? appeared first on AdviserVoice.

Philip La Greca

Self-managed super fund (SMSF) technology and administration provider SuperConcepts has released the latest SMSF Investment Patterns Survey which indicates a possible resurgence in term deposits as official interest rates rise.

The survey covers over 4,400 funds, a sample of the SMSFs administered by SuperConcepts, and the investment they held at 31 December 2022 which exceeds $7 billion in assets.

According to SuperConcepts Executive Manager Technical and Strategic Solutions, Philip La Greca, cash is king with few other options for liquidity.

“We’ve seen a 10% lift in extended term deposits during Q4 2022,” La Greca said, “and it would appear short-term term deposits are still unattractive for investors.”

With the decreasing average age for an SMSF trustee, expect to see significant change in the allocation of investments aligned to a younger demographic in the upcoming years.

Investments such as ETFs prove to be on the rise, but the current environment has left SMSF trustees with few options in terms of investment choices for immediate liquidity.

Findings from this quarter also highlight that fund managers are exploring different investment structures.

“Whilst pooled investment structures still have the lion’s share of international equities, it’s interesting to see that fund managers are branching into different structures to penetrate other sectors as well.”

Property continues to hold its own, with nearly 85% of exposure through direct holdings and all growth in this sector is attributed to the direct subset.

“It will be interesting, however, to observe whether there is a reported decline here in our next quarter’s report as valuations for 30 June 2022 and later appear,” La Greca notes.

Although there is a lot of commentary and questions surrounding “exotic” investments, such as cryptocurrency and collectables, these asset types only equate to 0.1% of the total investment pool.

The results from surveys such as this are crucial to our understanding of the sector as there is limited regular statutory reporting by SMSFs.

Read the report.

The post Valuable SMSF investment insights released for Q4 2022 appeared first on AdviserVoice.

Andy Forbes

SuperConcepts, the creators of SMSF accounting software SuperMate, has announced the launch of their latest investment portfolio solution.

SuperMate Portfolio is an end-to-end investment portfolio management software for trusts, companies and individuals.

The robust portfolio management solution helps accountants by automating CGT record-keeping and Financial Reporting tasks.

“Many firms are using old, difficult to use portfolio management software, and paying a premium for it. SuperMate is modern, easy to use and very efficient,” Andy Forbes, SuperConcepts Chief Technology Officer said.

The new-look SuperMate Portfolio promises beautiful design, ease of use and greater practice efficiencies.

The software, which is set to be unveiled on 30 November 2022 during an online event, uses the same technology powering the market’s newest SMSF administration software, SuperMate.

“This product enables accountants to enhance their client value proposition – it makes tracking CGT easy and has sophisticated reporting that clients will love.”

The live event will include the end-to-end processing of a portfolio, a demonstration of the automated document data extraction power of Data Hero^TM and an overview of reporting and branding capabilities.

“SuperMate Portfolio works hand-in-hand with our SMSF software – allowing users to administer both SMSFs and Portfolios on one platform, leveraging time-saving features and ways of working across both products,” Forbes said.

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Andy Forbes

Self-managed superannuation (SMSF) education, administration and software provider, SuperConcepts, has released the latest update to SuperMate Classic.

“SuperMate Classic version 4.7.1 introduces a range of improvements aimed at reducing processing times and providing an overall better user experience,” Chief Technology Officer, Andy Forbes, said.

Enhancements have been made to further support cryptocurrency involving simplified processing and an increase in decimal places.

“During a recent webinar we hosted, 60% of attendees reported that they had SMSF clients investing in cryptocurrency,” Forbes said.

The update includes changes to Exempt Current Pension Income (ECPI) functionality and an additional letter template has been added for a Trustee Resolution.

Improvements have also been made to depreciation, including new additions to the depreciation schedule report and linking depreciating assets to properties.

Users will also enjoy updates to the Business Activity Statement (BAS) screens as calculations, report labeling, and preferences have been updated to provide a better user experience.

“We’re heavily focused on redefining SMSF software with our next generation of SuperMate, however we are continuing to develop and improve both platforms – the new SuperMate and SuperMate Classic.”

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