Monday, 29 April 2013

SMSFs – winding up an SMSF

There are a number of reasons why you might want to wind up your SMSF:
  • All the members and trustees may have left the SMSF
  • All the benefits may have been paid out of the fund
  • There is an insufficient balance of funds in the SMSF to meet the ongoing costs of operating the SMSF
  • The fund may no longer meet the definition of an “Australian superannuation fund” because the trustees have moved overseas permanently (there was a great article in the AFR this weekend on this topic – http://www.afr.com/p/markets/market_wrap/diy_transfers_risk_departure_tax_TtT6ahFS7lIYStQ1nQKXIL – the solution is apparently to set up an APRA-governed fund instead)
  • You may simply not want to continue with the fund
It’s a decision that requires some thought, because once the fund is wound up, it can't be reactivated.

If you want to proceed, the ATO publication Winding up a self-managed super fund at
http://www.ato.gov.au/superfunds/content.aspx?doc=/content/00182487.htm provides a step-by-step guide to assist you with the process.


Basically, to wind up your SMSF you need to:
  • Notify the ATO within 28 days
  • Deal with all the assets of the fund so that the fund has no assets left
  • Arrange a final audit of your fund
  • Complete your reporting responsibilities, including lodging your final SMSF annual return and finalising any outstanding tax liabilities