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Tax Office to check DIY super

SELF-MANAGED retirement funds are growing in popularity in Australia - but the Tax Office has its beady eyes on the people who run them, with the aim of getting the mums and dads to cough up more income tax, capital gains tax or any other tax the tax man can think of.
The Tax Office has recently started a blitz on some 560,000 Australians who manage their own retirement funds. And that could be painful for many people.
Almost two-thirds of the country's estimated 300,000 DIY super funds are managed by self-employed people and have an average credit balance of $235,000.
Tax Commissioner, Michael Carmody said the blitz "will include taking a firm approach with trustees who fail to make a genuine effort to comply or who set out deliberately to avoid meeting their legal obligations."
Some people invest their funds in assets which benefit them before retirement, such as buying paintings to hang on the walls of their home or membership of golf clubs. All this is strictly against the law.
Other things you cannot do with the money from your own super retirement fund include:-
* Run a business with the fund's money;
* Lend fund money to family or friends;
* Buy wine as an investment and then drink it (what else can you do with wine?);
* Buy paintings and hang them on your walls;
* Buy a holiday home worth more than 5 per cent of the fund's value and then expect to stay there for a free holiday.
* Buy jewellery and then let your wife wear it (this is a real tough one). Warning signals the Tax Office will be looking for include:-
* Salary and Wage taken out of the fund;
* Excessive management and investment expenses;
* A fund paying a lump sum or pension to a member;
* Offshore investments;
* Value of assets falling significantly but no benefits being paid out.