Welcome back to 2015
It’s hard to believe it is February already. We hope everyone had an enjoyable break. Personally, I enjoyed spending time with my wife Victoria and son Jack fishing and crabbing at Brunswick Heads, N.S.W. prior to Christmas. Then 1770, Qld; in the New Year.
Just a distant memory now…
The Digital World
In today’s digital world, the use of electronic storage for photos, documents and other important content is very common. Superannuation law requires SMSF’s trustees to keep accurate SMSF records for specified time periods. Through the use of electronic storage, it can be not only more convenient, it can reduce the cost of maintaining these records. To enable SMSF’s to take advantage of potential cost savings, the Australian Taxation Office (ATO) has updated their record-keeping requirements to allow for records to be kept electronically by fund trustees. It is important to note that records kept electronically must be easy to access and verify.
Trustees are responsible for proper and accurate tax and super records. Taking minutes of investment decisions can help insure against trustees taking action for failed investments. Such records must also be made available for the fund’s approved auditor and the ATO, if requested.
Trustees should take minutes of all investment decisions, including:
• Why a particular investment was chosen
• Whether all trustees agreed with the decision
Circumstances can arise where one trustee (or director of the corporate trustee) could take action against another trustee for an SMSF investment that fails on the basis that the trustee/director failed to be diligent in their duties. However, where investment decisions are recorded in meeting minutes that are signed by the other trustees/directors, these records will show that the other parties had mutually agreed with the investment strategy decisions.
THE FOLLOWING RECORDS ARE REQUIRED TO BE MAINTAINED FOR A MINIMUM OF FIVE YEARS.
•Accurate and accessible accounting records that explain the transactions and financial position of your SMSF
• An annual operating statement and an annual statement of your SMSF’s financial position
• Copies of all SMSF annual returns lodged
• Copies of any other statements you are required to lodge with us or provide to other super funds
•Minutes of trustee meetings and decisions (if matters affecting your fund were discussed, for example, you reviewed the fund’s investment strategy)
THE FOLLOWING RECORDS NEED TO BE MAINTAINED FOR A MINIMUM OF 10 YEARS.
•Records of all changes of trustees
•Trustee declarations recognising the obligations and responsibilities for any trustee, or director of a corporate trustee, appointed after 30 June 2007
•Members written consent to be appointed as trustees
• Copies of all reports given to members.
•Documented decisions about storage of collectables and personal-use assets.
In addition to the above items, trustees must also ensure that the fund’s income tax record-keeping requirements are also maintained – in particular, documents on deductions, capital gains and losses. All records should be kept in writing and in English. Where a trustee decides to keep electronic records, they must be capable of verification by the Australian Taxation Office (as Regulator) and be in a form that they can access and understand.
If you have any queries, please do not hesitate to contact me.
Sunshine Coast: (07) 5474 8955
Brisbane: (07) 3421 3421
Email me directly: firstname.lastname@example.org