Why big super's pseudo-SMSF won't deliverBY KRIS KITTO | FRIDAY, 7 MAY 2021 11:55AM As the success of SMSFs boomed in the last decade, some industry funds rolled out self-directed or member direct investment options that allowed their members to invest (with ... Upgrade your subscription to access this article
Join the growing community of superannuation
professionals with unlimited access to our latest news, research and analysis of the industry.
Become a premium subscriber today. |
Latest News
ART strikes $883m QLD Westfield deal
Australian Retirement Trust (ART) has agreed to acquire a 50% interest in Brisbane's Westfield Mt Gravatt from Scentre Group for $882.5 million, in what is expected to be Australia's largest single-asset retail transaction this year.
HESTA reduces fees, minimum balance for income stream
HESTA will reduce administration fees and lower the minimum balance required to start an income stream account from September 30.
Trustees, platforms, cyber risk under APRA spotlight
Superannuation trustees, platforms and cyber resilience will be under more scrutiny in the 2027 financial year from the prudential regulator.
Nanuk lands AustralianSuper investment heavyweight
Nanuk Asset Management adds serious firepower to its investment team when it appointed Oliver Johnson, formerly at AustralianSuper, early this month.
Further Reading
Cover Story
Leading the way
SHARON DAVIS
NON-EXECUTIVE DIRECTOR
FUTURE GROUP AUSTRALIA HOLDINGS PTY LTD
NON-EXECUTIVE DIRECTOR
FUTURE GROUP AUSTRALIA HOLDINGS PTY LTD
Sharon Davis has always been fascinated by the human condition; it has driven her passion for people, her career, and building a better future for the next generation and beyond. Eliza Bavin writes.
Expert Feed
What if your super fund's biggest cost isn't on any report you've seen?
The cost of poor-quality onboarding and incomplete member data is not something most super funds can easily put a number on, but that needs to change.
Not all income is created equal
Why Australian public credit may be the most compelling source of income in today's market.
The case for private markets
As more companies stay private for longer, there is a real case for investors looking to the private markets for overall diversification purposes.
Dot dismissal: Scenario analysis in a regime-changing world
Investors hardly need reminding that macro shocks, both positive and negative, are hitting the global economy with growing frequency and force.
Thankyou Kris for your insights. To address your suggestion that big super funds pull money out of investment portfolios to cover future tax liabilities: in fact, they don't - they create an accounting provision for deferred taxes in valuing member accounts but this accounting liability is not backed by cash. It is essentially a gearing effect as the money remains invested to earn compounded returns until the tax is actually payable. This is really the same as SMSFs; it's just that the deferred tax liabilities are made explicit in the member account valuation. The point is that both types of funds can earn compounded investment returns until the tax actually has to be paid.
Just wanted to point out this article is inaccurate and probably misleading. Pseudo-SMSFs let each member who chooses to use them to accumulate unrealised gains just like an SMSF. Additionally some of them also allow members to transfer their investments in specie to the retirement phase and to directly benefit through the unrealised gain provision being removed boosting the balance available for retirement income.