.png)
The super fund was formed by 2 Australian tax residents. The fund balance was $150k as at 30/06/2019. During FY2020, the fund has added in two new foreign members. The new members contributed $100k in total into the fund. The fund remains in control by the two residents.
Is there contravention? What's verification?
Hi Ni,
In the annual return (ITR) at question 8 there is a question as to is the Fund an "Australian Superannuation Fund"?
A SMSF is an "Australian Superannuation Fund" if it meets 3 residency conditions:
Fund was established in Australia (or one of its assets is located in Australia).
Central management & control is in Australia.
The Fund has no active members or it has active members who are Australian residents & they hold at least 50% of member balances / Fund assets.
An active member is a member who is making contributions (or rollovers) to the Fund. You have not advised if the residents are active members so this will need to be ascertained to see if the residency test has not been met.
The ATO on their website state that "if your SMSF fails the residency test, you should roll over your funds to a resident regulated super fund and wind up the SMSF. Otherwise the fund will become non-complying." A non-complying Fund can have its assets & income taxed at the highest marginal tax rate.
The ATO have advised they will make allowances for Australians stuck overseas due to Covid-19 impacts, refer:
https://www.ato.gov.au/super/self-managed-super-funds/setting-up/check-your-fund-is-an-australian-super-fund/#Fundresidencyconditions
Thanks
SMSF AAA