SAFs planners' preference post-exemption, says consultant

Small APRA funds (SAFs) will be considered far more favourably and seriously by planners and investors than SMSFs when the accountants' exemption comes to an end, according to industry consultant JWW Consulting.

In a statement, the group's founder John Wiseman said he predicts the cost of SMSFs will increase substantially and that many investors and trustees will look to exit their SMSFs in favour of a retail, corporate or industry fund.

He added that while SMSFs will not disappear after July 1 when the accountants' exemption ends, his predictions of a decline in their use will prove to be correct.

"Far too many investors in the past were attracted to SMSFs by low or no fees," Mr Wiseman said.


"This has now come to an end, with unstructured, unqualified advice in the new era resulting in the severest of penalties."

SAFs have not been well understood or utilised, even by planners and accountants who are aware of them, he added.

"Although misunderstood in the past, SAFs are about to become a major force in the SMSF sector as they provide the perfect alternative for clients wanting the flexibility and control of an SMSF, but without all the compliance risk and responsibility of a trustee," Mr Wiseman said.

"An SAF may well be the ideal solution for those considering getting out of their SMSF but who feel they can't because of the tax implications of moving funds and investments.

"Furthermore, planners that have not considered SAFs in the past and failed to mention or recommend them in statements of advice as alternative strategies for clients will do so at their peril in the future," he said.

SAFs planners' preference post-exemption, says consultant
Small APRA funds
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