Business owners often discount the benefits of a self-managed super fund, taking it as cumbersome and complex. However, its benefits far outweigh the minor inconveniences it poses while increasing the value of your super fund.
Here are the incredible benefits of Self Managed super funds (SMSF) for small business owners:
Create business assets
Your self managed super funds can be used to acquire business assets. You may buy a property with the funds to increase your business value and expand your business, or buy a property and lease it to add additional income for you. Thus, your SMSF can help you create assets, add income and also diversify your investments.
Reduce capital gains tax
One of the primary benefits of SMSF is that it allows the inclusion of commercial properties. You can transfer your commercial property to SMSF and reduce your capital gains tax liability. Also, commercial property in SMSF entails reduced capital gains tax, should you sell the property. Therefore retirement planners strongly recommend having an SMSF account for better financial planning and reduced tax liability.
Tax Benefits on Fund income
Retirement planning experts recommend SMSF for tax planning. Income from SMSF investment attracts 15% tax. SMSF considers your commercial property as an investment and attracts the same taxation rates. When you transfer your commercial property to SMSF, your business can claim a tax deduction for rent paid to SMSF. The tax so saved can be diverted to your retirement fund and create a stream of passive income sources with regular contributions such as rent to the fund.
Better asset management
With SMSF, you retain full control of how the assets and the fund are managed. With full control resting with you, you can ensure that the fund investments align with your investment goals. Also, you can reduce the risk of legal proceedings and potential losses.
In addition to business benefits, your SMSF enables financial stability for you and your family. Creating a well-planned SMSF portfolio can help build personal wealth and secure your financial future. Moreover, the wealth in the SMSF can be transferred to the next generation after you are gone, thus protecting the financial interests of your loved ones.
SMSF offers several benefits, both in the long and the short run. You may reach out to reputed financial services in Australia for a hassle-free experience of opening an SMSF.