We always recommend our clients use a special purpose trustee company for their SMSF. Once the trustee company is set up, the ongoing maintenance to look after it is relatively simple, but very costly if you get it wrong as the Australian Securities & Investments Commission (ASIC) can levy hard penalties that are difficult – if not impossible – to get remitted.
In this article we will show you how to make looking after your SMSF trustee company easy and save you money at the same time.
ASIC late fees
If you cannot, or forget to pay on time, the ASIC late payment fees ASIC applies are quite onerous:
- Up to one month late – $80
- More than one month – $333
So how can you ensure you avoid these hefty fees, as well as simplifying the administration of your SMSF trustee company? Easy!
Advance pay the annual review fee for ten years
If you make an advance payment of $375 (if prior to 30 June 2020) you will save based on the current annual review fees for a special purpose company. In truth you are likely to save more as ASIC typically increases the annual review fee by at least $1 per annum.
But more importantly you will not have to worry about remembering to pay the annual review fee for the next 10 years – which means no possibility of late fees!
It’s also possible to prepay the annual review fees for standard proprietary companies. The cost is $1977 which is a saving of $693 over 10 years (based on the current annual fee of $267).
What you need to know
- At this stage payment to ASIC can only be made via cheque
- Superfund Partners will track the prepayment in your SMSF accounts
- Please send a copy of the completed form to Superfund Partners for our records
- Annual Company Statements will still be issued once a year – but $0 will be payable
- Any changes that happen over that 10 year period (such as changes of address) still need to be notified to ASIC within 28 days. We can assist with these notifications and the required paperwork.
- Once paid the amount is not refundable
- The 10 years doesn’t include the previous year – so if you have already been issued a recent Annual Company Statement and has a $54 fee to pay, you must separately pay that amount in addition to the 10 year prepayment.
You can find out more about the 10 year prepayment on the ASIC website here.
What you need to do
If you would like to take advantage of the ASIC prepayment strategy, simply follow these steps:
- Download the remittance form here: Advance payment remittance form (PDF)
- Complete details of your company and the cheque you are sending to ASIC
- Send one copy to ASIC and also a copy to Superfund Partners
- Let us know any changes to your company when they occur (such as a change of address)
Superfund Partners can also prepare the form on your behalf and send it to you to attach the cheque and send to ASIC.
If you would like to take advantage of the prepayment strategy, please email our ASIC specialist Tracey (email@example.com) and she would be more than happy to assist you.