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Task 6.3 - Fund Pension Policies

Details

In this task we are determining the tax exemption percentage applicable to the Round Table Fund under Deemed Segregation.

 

At 1 July 2017, the fund has some members in pension phase and the other member in accumulation. On 15 May 2018, all of the members are in pension phase.

 


Instructions

To process this in Simple Fund 360:

  1. Navigate to the Fund Pension Policies screen
    From the Main Toolbar, go to Member.

    Select Fund pension policies from the list.



  2. Click New Actuarial Certificate


  3. Select Manually Enter Details and select the financial year:


  4. Click Manually Enter Details

  5. Enter the Tax Exempt (Actuarial) Percentage for the Unsegregated period:


  6. Enter the Start date as the date the segregated period commences. This will be the day the pension commences in this example. Enter the End date for the Segregated period then click Add:


  7. Choose the method to calculate the expense deduction then click Save:


  8. Review the fund pension policy posted by Simple Fund 360:

Certificate Status

Using an integrated actuary certificate provider

Deemed segregation is fully supported with our integrated actuary certificate providers.

To process the scenario above using Simple Fund 360's integrated actuarial certificate providers:

  1. Navigate to the Fund Pension Policies screen
    From the Main Toolbar, go to Member.

    Select Fund pension policies from the list.



  2. Click New Actuarial Certificate


  3. Select Request Actuarial Certificate and the financial year:
  4. Click Request Actuarial Certificate:

  5. Select a supported provider then click Next

    Supported Providers

    For a list of supported providers, please refer to Fund Pension Policies

  6. Confirm the contact details for the fund then click Next


  7. Confirm the fund's eligibility to use the Segregated method (applicable in this example) then click Submit to Actuary:

  8. Click 'Click here to complete your application'
  9. Log in the actuary certificate provider's website (This example is using Act2):
  10. Review the details of the percentage then request the certificate:

  11. Review the fund pension policy received from the actuary provider in Simple Fund 360:

The Certificate Status will sometimes not change to Confirmed when requesting a certificate through Act2. Act2 will add this ability at a later stage.

General and Investment Expense Percentages

Generally, expenses incurred by an SMSF in deriving Exempt Current Pension Income cannot be claimed on the SMSF Annual Return. Where an expense relates to both accumulation and pension members, the expense must be apportioned so that only the proportion of the expense relating to the production of assessable income is claimed.

Simple Fund 360 provides the following options to apportion the general and investment expenses 

Option
Explanation
Use ATO Formula

Select this option to calculate the expense percentages based on the formula contained in the ATO's Taxation Ruling 93/17. Simple Fund 360 will calculate the percentages during the Create Entries process.

User SpecifiedBy selecting this option, users will be able to manually input a percentage for both general and investment expense percentages.
Use Actuarial %Select this option to use the current year actuarial percentage for both the general and investment expense percentages.

In the 2017/2018 financial year if the fund has a both a deemed segregated and unsegregated segment and you are using the User-Specified % or Actuarial %. Simple Fund 360 will apply the expense percentage to the unsegregated segment(s) only.

Task 6.2 - Commence a Pension Appendices

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