During Covid the ATO halved the minimum paydown rates from people’s SMSFs.
This was to protect retirees from being forced to sell assets to meet those payments at a time of “unprecedented” volatility and uncertainty.
However, effective from 1st July 2023 this threshold reverted to its original age dependent levels - effectively doubling.
Most of you use SMSF software that will pick this up, but it is worth planning this out early.
The significant rise in asset values, especially property, over the past few years means that:
- Members’ super balances may well have increased substantially.
- There may be insufficient liquid funds to meet the normalised minimum drawdowns.
And this does need to be resolved by 30 June 2024.
Otherwise your trustees are exposed to loss of tax-exempt income, and the ATO is becoming increasingly vigilant about SMSF compliance.
Watch out for our EOFY SMSF checklist and a valuation guide that we will publish soon, to make your run into 30 June just that little bit easier.
As always if you have any queries please get in touch and we’ll see how we can help.