things to be aware of before deciding

Know your responsibilities

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All trustees/directors of SMSFs are equally responsible for the running of the fund for the benefit of its members. You should understand your responsibilities before setting up your fund. The ATO has a fact sheet on Key Messages for Trustees here.

Keeping things seperate

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All SMSF accounts and transactions must be kept totally seperate from your personal accounts. So you need to set up dedicated SMSF accounts for banking, crypto exchange accounts etc. Mixing funds with personal accounts could end you up with a hefty fine from the government.  So make sure you check with us if you are unsure.

Check your insurances

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Retail super funds give better insurance deals than you can get with an SMSF because they buy 1000's of policies at a time. If you are on a good deal and want to keep it, you can keep a few thousand in your old fund to keep the policies active and rollover the rest. The rules are different with different funds so call your provider to find out more. 

150 Transactions per financial year within the fund

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Our $140 per month accounting fees cover the tax returns, audits and compliance on up to 150 transactions within the fund per year. Additional transactions will be charged at $3.30 per transaction. So be mindful of this if you are staking coins or actively trading.

No borrowing, leveraging or shorting allowed

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You cannot borrow, leverage or short any crypto within the SMSF. No exceptions. Doing so could leave you with a government fine or even jail time. You can borrow to purchase property in an SMSF if you set up a bare trust which we can offer for additional costs.

Keeping records of your crypto trades within the SMSF

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All trades within the fund need to be recorded as going either into or out of AUD. (even if you actually trade BTC directly with ETH ). We are working with exchanges to make the accounting easier but in the meantime you need to record the AUD value of each coin as it it traded. 

Buying gold in your SMF

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You can buy gold and precious metals in your SMSF. If storing it at home you need to get it insured under a policy held by the SMSF. Be sure you can get insured before purchasing the precious metals otherwise you will need to keep it with a custodian.

Multiple members in the SMSF

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You can have up to 4 members in your SMSF and the cost to run it is the same. Each member is equally responsible for the running of the fund. The SMSF runs as one entity so you cannot for example say "this is my gold and this is your bitcoin."  You are all in it together.

The bottom line

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It is important to understand that each person in the fund is acting as a member and a fund manager. You as the fund manager are responsible for investing the member's money for their retirement. It is against the law to borrow from the fund for personal use.

We are here to help.

While New Brighton Capital does not offer financial advise, we are here to help. If you are unsure on some of the ins and outs regarding an SMSF, why not book free consultation with one of our specialists who can answer your questions in plain english?

Book free consultation