Specialist SMSF Services
SMSF & Crypto
Adding crypto to your SMSF? Do it right and stay compliant with our technical specialist advice.
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Your cryptocurrency SMSF accountant
As this is a new asset class, many trustees are making critical compliance errors. Do it wrong and you could face hefty penalties and the possibility of your fund being made non-compliant by the ATO and you’ll be left paying the highest marginal tax rate.
There are strict regulations to be followed and maintaining clear accounting records is extremely important. SIS rules govern how the crypto exchange account is opened, how coins are stored, bought, sold or swapped and how much and when the tax is paid.
At Easy Super we stay up to date with changes to SMSF crypto regulations. Plus our almost 20 years of SMSF experience means that we can answer all your SMSF questions and guide you through this exciting new investment opportunity with our technical expert advice. Why not chat to Natalia today?
Our SMSF crypto services
SMSF Establishment
To set up a superfund that is allowed to purchase crypto, you need to ensure that the Trust Deed and SMSF Investment Strategy allows for investment in crypto.
You will need to set up a separate wallet in the name of the SMSF.
Easy Super can walk you through the SMSF SIS rules and regulations which are important to know when you want to add cryptocurrency to your SMSF portfolio.
Annual Compliance
When using your SMSF to trade in crypto there are clear rules to follow which Easy Super can guide you on.
These include ensuring that the crypto exchange account is in your fund’s name and making sure you’re not mixing personal and SMSF coins.
At Easy Super we can take care of your annual SMSF compliance: prepare the financials and Income Tax Return as well as liaise with the independent auditor and help your SMSF to stay compliant.
SMSF Crypto Advice
With Easy Super you get the best technical and crypto tax advice.
We’re always available to answer your cryptocurrency questions, such as how to buy crypto with your SMSF, capital gains tax, compliance queries, making sure your crypto is valued correctly etc.
We’re experienced at helping clients who’ve contravened SIS regulations to return to a compliant state.
SMSF & Crypto: Frequently Asked Questions
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Yes you can buy cryptocurrency with your SMSF. Note that while it is technically possible to invest in crypto via a SMSF, that doesn’t mean you should. Speak to a qualified and licensed financial advisor to obtain professional advice that is relevant for your personal circumstances.
It’s also not advisable to have crypto as your sole investment asset due to market volatility and risk. An SMSF is meant to provide Australians with a reliable and stable retirement income and must pass the ATO’s Sole Purpose Test. If you invest purely in risky assets without a clear strategy, you may contravene SIS regulations and face penalties.
You can open an account in any Australia based cryptocurrency exchange. The account must be opened under the SMSF’s name and you should keep SMSF coins separate from all other coins you have. You should also keep records of all the transactions in your SMSF.
Yes. Self managed super funds can invest in Bitcoin, Etherium and all other recognized cryptocurrencies.
The ASIC (Australian Securities and Investments Commission) warns SMSF trustees to be aware of the risks when buying crypto. Self Managed Super Funds are being targeted to buy cryptocurrency and have proven to be easy targets for scammers. Besides these scams, crypto-assets are highly volatile and unstable. While they can offer you a potentially good upside, there is the possibility of big losses. If your fund is over-invested in crypto this could have a negative impact on your retirement annuity.
Other risks of buying crypto are around not trading in a SIS compliant manner which can lead to penalties and higher tax rates. Which is why it is extremely important to have an accountant who is familiar with cryptocurrency transactions and can guide you to stay compliant.
Crypto in SMSF: What not to do
Common non-compliance issues we see when an SMSF buys crypto.
- Do not buy crypto if your trust deed doesn't allow it
- Do not buy crypto if your investment strategy doesn't allow it
- Do not borrow to trade crypto
- Do not open account in your personal name
- Do not buy crypto from related parties
- Do not mix personal coins with SMSF coins
- Do not move coins to different wallets all the time
- You must keep good financial records
SMSF Crypto Case Study: 94% to 0% Tax
Steve came to us because he had done most of the above and was facing serious compliance issues with his SMSF. He set up his fund via an online provider and began using his SMSF to purchase and trade crypto. When he ran into problems his provider wasn’t able to answer his questions around cryptocurrency and SMSF compliance.
He had breached multiple SIS rules and had even been scammed and lost crypto-assets. He was facing the very real possibility of his SMSF being made non-compliant by the ATO, paying up to 94% tax and penalties, as well as losing a large portion of his retirement savings.
He came to Easy Super and we were able to help fix all his contraventions and in the end bring his tax rate down to 0%.
Talk to Natalia today if you’re struggling to get good advice or are in a similar position.
Easy Super makes SMSF crypto, super easy
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Super Consulting Pty. Ltd.
- 19 Selby ave, Dee Why NSW 2099
- 1800 327 978
- 0432 366 690
- enquiry@smsfconsulting.com.au
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Disclaimer: All information on this website has been prepared without taking into account your individual objectives, financial situation or needs. Because of this, you should, before acting on this information, consider its appropriateness with regard to your objectives, financial situation or needs. Speak to Natalia for SMSF advice.