The Government has released draft regulations proposing to amend the SIS Regulations to require trustees of SMSFs to value the assets of the fund at “net market value” for reporting purposes from the 2012-13 year of income. “Net market value” will be defined to mean the amount that could be expected to be received from the disposal of an asset, in an orderly market, after deducting the costs expected to be incurred in realising the proceeds of such a disposal.
The draft regs also propose to amend the investment strategy operating standard in SIS reg 4.09 to require SMSF trustees to consider whether to hold a contract of insurance for one or more of their members. SMSF trustees will also be required to “review regularly” the investment strategy. A proposed new operating standard will require trustees to keep money and other assets of an SMSF separate from money and assets held by a trustee personally and by a standard employer-sponsor (or an associate). The proposed regulations will commence on 1 July 2012.
SUBMISSIONS are due by 1 June 2012.