SMSF Sorted Observations Feature Overview

SMSF Sorted Observations Feature Overview

SMSF Sorted Observations Feature

Observations in SMSF Sorted are validations and checks that have been built into the system to highlight specific compliance situations that may require attention.

What Observations are available?


Observation
Details
Preservation Components for Member above 65
To check if member entitlement components are 100% unrestricted non preserved
Tax Component Verification (Accumulation)
To check for changes in tax-free amount of accumulation account
Work Test
To check if the work test needs to be satisfied for contributions received for members over aged 65
Contribution Cap Limit
To check if members have breached contribution caps
Negative Balance
To check if bank accounts have a negative end of day balance at any point in the year
Contra Bank Entries
To check for deposits and withdrawals of the same amounts between bank accounts or the same account.
Client Missing Data
To check if the client has any missing data, e.g., member date of birth, Fund TFN etc
Benefits Paid to Member < 60
To check if PAYG payment summary is required
Market Value
To check market value as per software against the ASX and IRESS data for listed investments and managed funds
Income Comparison
Comparison of income processed for ASX listed investments against announcement data
Pension Limit
To check if pension withdrawals are within the allowed limits
Tax Effective Allocation of Pension Payment (Member Level)
To check whether pension payments above the minimum amount are allocated in a tax-effective way between the pension accounts of a member
Lump Sum Payment
To check the condition of release for a lump sum paid before preservation age
Preservation Components
To check for changes in components from preserved to unrestricted non preserved
Tax Component Verification (Pension)
To check for changes in tax-free percentage of pension accounts
Retirement Condition
To check for a Retirement Condition for any benefits paid to a member less than 65
Tax Effective Allocation of Pension Payment (Pension Account Level)
To check whether pension payments made above the minimum amount are allocated in a tax-effective way between all pension accounts



The video below provides an overview of the SMSF Sorted Observation Feature



NOTE: From the SMSF Sorted release 2.2 (October 2020), notes have been added to the Lump Sum Payment, Retirement Condition and Benefits Paid to Member <60 observations for the 2019/20 and 2020/21 financial years due to special early release measures for COVID-19

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