653 paragraphs found
The trustees of a SMSF are required to maintain the fund in a manner that complies with the sole purpose test at all times while the SMSF is in existence. This extends to all activities of the SMSF including: accepting contributions; acquiring and …
In assessing whether a SMSF has complied with the sole purpose test, the auditor may refer to the ATO’s Ruling SMSFR 2008/2 [147] on the application of the sole purpose test to circumstances where the SMSF is maintained for the purposes prescribed while …
In assuring compliance with the sole purpose test, the auditor looks for the provision of current day benefits, being benefits to a member or related party before the member’s retirement, employment termination or death, and assesses whether those …
Current day benefits are likely to fail the sole purpose test if the benefit: was negotiated or sought-out by the trustees; has influenced the decision making of the trustee; has been provided at a cost or financial detriment to the SMSF; and is part of a …
Current day benefits are more likely to comply with the sole purpose test if: the benefit is an inherent and unavoidable part of activities for allowable purposes; the benefit is remote, isolated or insignificant; the benefit is provided on arm’s length …
The sole purpose test is complemented by other restrictions in SISA relating to dealings with members and related parties, such as prohibitions or restrictions on: transactions not at arm’s length; [150] loans or financial assistance to members or …
If a trustee is also an employee of the business, payment of salary or wages to the trustee must be on an arms-length basis. The auditor assesses all circumstances of a SMSF running a business to determine whether it is in breach of the SISA or SISR. It …
SMSFs that engage in high volume trading of derivatives, listed securities, real property or other investments, or a series of property developments, may be running a business for purposes other than solely for providing specified benefits to members and …
The SISA contains a number of investment restrictions with which the trustees are required to comply. In assessing whether these prohibitions have been complied with, the auditor examines the nature of each material investment, to ensure that the …
Membership investments, such as ski lodge, country club or golf club memberships, providing a right to use a facility or service, will usually fail the sole purpose test if the trustees or members derive a current day benefit from the investment. …