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Closing down a self-managed superfund

In recent years, there’s been a surge in seniors looking to close down their self-managed super funds (SMSF). The overarching reason is that a SMSF takes a lot of work. Even when they’re set up with the best intentions, the time commitment required can becomes stressful and burdensome — sometimes, it takes years to realise that. If you’re looking for an exit, we’ve laid out the simplest way to safely and efficiently close your SMSF.

Before we jump in, it’s best to start planning the closure as soon as possible. It’ll work in your favour if you do this early in the financial year. That way, you won’t feel rushed throughout the process and will have ample time to prepare, as well as tie up any loose ends.

1. Allocate a place for your money.

The first step takes a “begin with the end in mind” approach. When you close your SMSF, you’ll need to reallocate your funds in a new managed super so you can access them. So, decide where your money will go. As there are a lot of options available, we suggest getting financial advice so you can make an informed decision. Not all funds will be suitable for you, but a financial adviser will be able to suggest a couple of great options to choose from.

2. Determine where fund assets will go.

You’ll either want to distribute or liquidate your fund assets. Some funds will allow you to transfer listed assets from your old fund to your new one (another reason why we suggest seeking financial advice). Just be prepared to give the sell down some thought if the fund contains illiquid investments — such as delisted shares.

3. Have an accountant organise the shutdown.

Your chosen accountant will draft rollover benefit statements and organise the shutdown on your behalf. Additionally, you won’t miss any important requirements when it comes to tax matters, such as GST, PAYG, tax return audits, and so on.

Ascent can help with the process of shutting you SMSF down, completing forms and updating the Tax Office. If you require financial advice we can refer you to advisors to help.

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