Valuing fund assets for SMSFs

One of the many responsibilities SMSF trustees have every income year is valuing their fund’s assets at market value.

The market value of an asset is the amount that a willing buyer and seller would agree to in an arm’s-length transaction.  These valuations will be used  when preparing the fund’s accounts, statements and SMSF annual return (‘SAR’).

Asset valuations will be reviewed by an approved SMSF auditor as part of the annual audit prior to lodgment of the SAR.  The auditor will check that assets have been valued correctly and assess and document whether the basis for the valuations is appropriate given the nature of the asset.  The auditor is not responsible for valuing fund assets.

Taxpayers should ensure that they have their valuations done before going to the auditor.

It is the responsibility of the SMSF trustee to provide objective and supportable evidence to their auditor for the valuation of the fund’s assets, including all relevant documents requested to prevent delays in auditing the fund.  Failure to do so could result in a potential late lodgment of their annual return or a contravention if mistakes have been made.

SMSF trustees should start researching now to find what type of evidence they need to support the valuation as this can take time.  For some asset types valuations must be undertaken by a qualified independent valuer.

DO YOU HAVE QUESTIONS ABOUT THIS BLOG TOPIC?

CALL (08) 9248 8124 NOW OR SIMPLY FILL IN THE FORM BELOW

Posted in

Related

Warren Kruger

Specialist Tax Consultant - “Helping YOU Pay The Correct Tax And Not A Penny More”. My story starts on Christmas Eve, back in 1983 in South Africa.

Need Help With

Your Tax Return?

Complete the form below for a fast response

"*" indicates required fields

Name*
This field is for validation purposes and should be left unchanged.

Scroll to Top
Call Now Button