John Maroney

The SMSF sector will benefit from technology advances, but it will be evolutionary, not revolutionary, SMSF Association CEO John Maroney told the ‘Thought Leadership Breakfast’ that kick started the Association’s 2022 National Conference at the Adelaide Convention Centre yesterday.

“We have seen the advances that technology have delivered to the SMSF, accounting and financial planning sectors, and it will continue, but in doing so we must remember that any change must benefit the SMSF trustee.

“Other industries have managed to use technological change for the benefit of the end consumer, and I can see no reason why this cannot happen in our sector.

“The building blocks for a strong integration between technological change – I include Artificial Intelligence (AI) in this – the advice community and trustees are in place, and now we must focus of maximising the benefits for both the industry and trustees.

“This is particularly the case where it applies to legislation and regulation, where change is influenced by government policy priorities, and we have to accept that sometimes our sector will not be the first priority.”

The ‘Thought Leadership Breakfast’, sponsored by Act2 Solutions, saw Maroney as part of a five-member panel examine in depth the broad trends in technology, such as remote client servicing, cloud collaboration, and big data analytics, in a discussion that generated keen audience participation.

The Managing Director of BGL Corporate Solutions, Ron Lesh, says the benefits of technological change are self-evident with the efficiencies they have delivered saving practitioners hundreds of hours a year chasing things such as e-signatures and tax statements.

“In the future, I believe open banking will help improve efficiencies in the sector, and it’s encouraging to see the banking system now being more cooperative in allowing this to happen to the benefit of the SMSF sector.”

Head of Research at Investment Trends, Dr Irene Guiamatsia, cautioned that SMSF trustees must be front and centre of any technological change. “The pandemic created a unique opportunity for all to experience first-hand the best-of-breed benefits of technology, and to become more adaptable and supportive of change. SMSF trustees are no different. It is therefore incumbent on the industry and SMSF providers to continue to ensure future technological evolution responds to these heightened expectations.”

The Director of Smithink, David Smith, who moderated the panel, noted that the Quality Advice Review, headed by Michelle Levy, had the opportunity to examine how digital advice could benefit some consumers.

“In addition, could AI be used to determine whether an SMSF has broken any of the major SIS rules. We are seeing auditors starting to use AI to improve efficiencies, so it will be interesting to see how audit processes develop.”

Co-Founder and CEO of OpenInvest, Andrew Varlamos, stressed that technological change provided a genuine opportunity for the industry to improve the investment performance of the 70% of SMSFs where trustees make their own investment decisions.

“There is a plethora of investment information available to trustees from myriad sources, but much of it is of questionable value. And it’s extremely difficult to sift through all this and make sound investment decisions. What technology like OpenInvest enables is for trustees to find a trusted and expert portfolio manager who will manage their portfolio for them, and keep them informed, all through the technology.”

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Arthur Naoumidis

DomaCom Limited (ASX:DCL) (‘DomaCom’ or ‘the Company’) is pleased to announce that the Company’s platform has been integrated with BGL Corporate Solutions Pty Ltd. (‘BGL’) Simple Fund 360, Australia’s leading  self-managed superannuation fund (SMSF) administration solution.

BGL has implemented a seamless data interface with DomaCom which will allow 200,000+ SMSF’s to use the DomaCom Fund. Following the integration, SMSFs’ accountants are now able to receive automated transactional data feed into their Simple Fund 360 software from the DomaCom platform.

The integration with BGL is a major milestone for DomaCom that builds upon the Australian Tax Office (‘ATO’) ruling on downsizer contributions last year. Specifically, the ATO’s Administrative Binding Advice^[1] confirms part disposal of a home for downsizer contributions. This means that a person can dispose of part of their home under DomaCom’s Senior Equity Release platform and be eligible to make a downsizer contribution.

The ability to contribute the proceeds of downsizing part of a home into superannuation was one of several measures announced in the 2017-2018 Budget to reduce pressure on housing affordability in Australia. From 1 July 2018, eligible people aged 65 or over have been able to make a downsizer contribution into their superannuation of up to A$300,000 from the proceeds of selling all or part of their home.

As downsizer contributions are not subject to the usual concessional or non-concessional contribution caps, they can still be made when a member’s balance exceeds $1.6 million. Whilst 5,000 retirees used this facility in the first year, research indicates that a large proportion of retirees would prefer to access the downsizer provisions while being able to continue living in their homes.

The ATO confirmation on part disposal now means that SMSF retirees can use DomaCom’s Senior Equity Release platform to sell a part interest in their home and make a downsizer contribution without having to move out of their home. While a residential property cannot be sold to an SMSF, a part interest of a home can be sold to DomaCom’s Senior Equity Release platform which provides cash to the member that they are legally able to contribute to their SMSF.

DomaCom CEO, Arthur Naoumidis, said: “DomaCom is excited to partner with BGL on efficiently delivering the benefits of our innovations to Australia’s self-funded retirees. The ability for retirees to support themselves by modifying their personal balance sheets and moving some of the financial resources tied up in their homes to their super funds will enable them to enjoy a better retirement. Thanks to our partnership with BGL, they will be able to do this with the knowledge that their accountants can efficiently administer their SMSF’s.”

BGL Managing Director, Ron Lesh, said: “BGL has been at the forefront of innovation in the delivery of SMSF administration solutions since 1997 and I am pleased to welcome DomaCom to the BGL family to help our clients support their self-funded retirees.”

Highlights

• DomaCom has been integrated with BGL via a data implementation
• BGL provides self-managed superannuation fund (SMSF)  administration to 60% of Australia’s 600,000 SMSF’s
• Accountants can now more efficiently administer their SMSFs and access data from DomaCom
• SMSF’s can now use DomaCom’s  Senior Equity Release platform to benefit from the Australian Tax Office’s recent ruling on downsizer contributions and top up their SMSF

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[1] https://www.ato.gov.au/General/ATO-advice-and-guidance/ATO-advice-products-(rulings)/Administratively-binding-advice/

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