In early September, the government reintroduced its measure to increase the number of members allowed in an SMSF to six, when it introduced Treasury Laws Amendment (Self-Managed Superannuation Funds) Bill 2020 into the Senate.
After the bill was referred to the Senate economics legislation committee, the committee in early November recommended that the six-member SMSF bill be passed.
In a straw poll run by Accountant Daily sister title SMSF Adviser, 52.7 per cent of 575 respondents said that at least some of their SMSF clients were thinking about adding members to their fund, provided the six-member SMSF bill is passed.
Out of the 303 respondents with clients intending to add new members, the majority or 56.8 said that only a small number of their clients were interested in taking up the measure.
This is broadly in line with a poll run by SMSF Adviser in 2018 which found that 49 per cent of SMSF professionals had at least a few clients looking to take advantage of the measure.
One of the attractions of the measure in 2018 was that it would allow SMSFs to reduce the impact of Labor’s proposal to remove excess franking credits as it would make it easier to add accumulation members into the fund and allow the fund to offset franking credits against tax paid on contributions.
Following its election loss in 2018, Labor Party leader Anthony Albanese confirmed in a speech late last week that changes to franking credits were firmly off the table for the next election.
“I can confirm that Labor has heard that message clearly and that we will not be taking any changes to franking credits to the next election,” he stated in a speech on Saturday.
Following the reintroduction of the measure, SMSF technical experts have pointed out that while adding additional members to the fund may increase the complexity of administration and decision-making, it may have benefits such as providing greater investment power and making it easier to comply with the residency requirements.