Understanding SMSF Tax

When does my SMSF need to lodge its tax return?

First year SMSF returns for new funds are due by the 28th of February;
Second and subsequent year SMSF returns are due by the 15th of May.

Can I do my SMSF financial statements and taxes myself?

From a practical perspective: No. You would need to be a registered tax agent and have specialist accounting knowledge to accurately and compliantly complete and lodge the necessary reporting requirements.

Is 15% tax taken from my contributions automatically?

No. Unlike industry or retail super funds, an SMSF does not automatically take 15% tax on employer contributions at the time they are made. Your SMSF still has to pay 15% tax on the contributions, but the tax is assessed when the annual tax return is prepared after the end of the financial year. Your SMSF then pays 15% tax on the contributions net any allowable deductions.

How often does my SMSF have to pay tax?

Most SMSFs will only have to pay income tax once per year. Tax is payable when the SMSF lodges its annual tax return.

When an SMSF has tax payable for one financial year, the following financial year its likely Pay-As-You-Go (PAYG) Instalments will be required in the next financial year. This is basically tax paid in advance based on the ATOs estimate of your tax liability.

PAYG Instalments are paid quarterly however where the estimates annual tax is $8,000 or less you can elect to pay them annually by the 21st of October each year (i.e. the October after the financial year - which would be 21 October 2024 for the financial year ending 30 June 2024). Paying annually means your SMSF retains the cash in its account for longer.

How does Capital Gains Tax work with an SMSF?

Capital gains are also taxed at 15% however the general CGT discount reduces this by 1/3rd which makes the capital gains on investments held for 12+ months 10%.

By default our SMSF accounting system will default any capital gains calculation to the the lowest gain amount based on the specific cost base of parcels of shares/stocks are available.

Should my SMSF be registered for GST?

Due to the fact that with Stake Super there will not be very much GST paid, in most cases it will not be worthwhile to register an SMSF for GST, however this can be reviewed if your SMSF is incurring a significant amount of GST on expenses or transactions.

Can I elect to pay div293 tax from my SMSF?

Yes. You have up to 60 days from the date of the Div293 assessment to complete the election form online via myGov or lodge a paper form.

To complete an election form online, you need to have registered for myGov and linked to the ATO Online Services. If you’re not already registered for myGov or your account isn’t linked to the ATO, you can do so by visiting the online services portal. Once you’re correctly linked to the ATO, you should see the Australian Taxation Office listed under your services when you log in to myGov.

To make your election, follow the below steps:

1. Login to myGov and click on the ATO image to access ATO Online Services.
2. Select the ‘Super’ tab from the top menu.
3. Scroll down and click ‘Manage’ to reveal the sub-menu.
4. Click on division 293 election
5. View your available elections.
6. Choose which super fund you want to pay the Div 293 tax from (if your SMSF isn’t listed please contact us at [e-mail]).
7. Complete the declaration and lodge for the election that you would like to complete.

Once the election form is lodged, we should receive a ‘Notice to pay’. Please let us know if we should expect this.