Month: December 2021
Why wait for interest rates to go up before considering a fixed interest loan from 1.89% p.a.?
Now is a good time to consider a fixed interest loan whilst interest rates are low and before improvements in Australia’s economy result in the Reserve Bank of Australia (RBA) declaring higher interest rates. This might not be soon or before 2022, but Governor Philip Lowe of the RBA believes that over time with the economy moving towards full employment and more normalised inflation, interest rates will go up.
As rates continue to stagnate – from 1.89% per annum – and are unlikely to drop, homeowners and property investors should look to take the time to examine locking in a fixed interest loan.
A fixed interest loan usually has a cap on additional repayments, so you will need to read the fine print when fixing your loan.
Individual circumstances vary and you will need to consider whether a fixed loan is right for you, but it could save you money over the term of your loan.
To help you decide whether to fix your loan, consult YML Group for expert financial advice. With expert financial advice, a fixed loan can be an attractive proposition, especially now as Australia’s economic outlook is of a positive upswing.
How can YML help?
Talk to our YML Finance Team today to see how YML Group can assist you with fixed interest loans. For more for more information, view our website contact us on (02) 8383 4466 or by using our Contact Us page on our website.
Transfer Balance Caps and what they mean for your Superannuation and Succession Plan
On 1 July 2021, the Transfer Balance Cap (TBC) was indexed for the first time to $1.7 million from the original $1.6 million limit which was introduced on 1 July 2017. Indexation of the TBC means there is no longer a single cap that applies to all individuals. Instead, every member has their own personal TBC of between $1.6 million and $1.7 million, depending on their circumstances. If you are already in receipt of a pension, it is important to review your personal TBC and seek help if you unsure how to calculate, or locate, your personal TBC.
The TBC not only imposes a limit on the amount of capital that you can transfer to the retirement phase of superannuation, but it also has an impact on what happens to your superannuation when you die. The $1.7 million TBC applies to pensions paid to your dependants after you die (called death benefit pensions or reversionary pensions) and it has a substantial impact on estate planning.
When it comes to the TBC, these are some of the main issues that you need to plan for in the event of death:
- If your death benefit will be paid as a death benefit pension, your beneficiary’s TBC will be relevant in determining how much can be paid as a pension to them. Any excess death benefit above their TBC must be paid as a lump sum to them. This limits the amount of money that can now be retained within the superannuation environment upon your death.
- Where your dependant has already used some of their TBC, you may need to consider strategies which maximise the amount of your benefits that can remain in the SMSF on your death and minimise the amount that would need to be paid to your beneficiaries as a lump sum.
- Special rules which delay when the reversionary pension counts towards a new recipient’s TBC and the differences between how reversionary and non-reversionary pensions are counted towards a new recipient’s TBC.
- Special rules that operate to modify the TBC of a child in receipt of a death benefit pension to ensure that their personal TBC is not exhausted.
- The ability for a recipient of a death benefit pension to roll over the pension to another superannuation fund (note, to satisfy the regulatory rules, a new death benefit pension must be commenced in the new fund or the amount must be withdrawn from the superannuation environment as a lump sum death benefit).
The payment and tax treatment of death benefits paid from a SMSF has traditionally been a complex area and certified financial advisors like YML Group can help make this area clearer to understand.
How does the new TBC affect your superannuation and succession plan?
Consult YML Finance to help you review and assess your succession plan. YML’s expertise in superannuation will ensure you have all you need to know about how TBC will affect you.
How can YML help?
Talk to our YML Super Solutions Team today to see how YML Group can assist you with your superannuation. For more information, view our website and contact us on (02) 8383 4444 or by using our Contact Us page on our website.
It’s time to apply for a Director Identification Number (DIN)
As part of the 2020 Budget – Digital Business Plan, the Australian Government requires all Australian company directors to mandatorily register for a Director Identification Number (DIN).
A DIN is a unique number assigned by the Australian Taxation Office (ATO) to a director for eternity, even if you change companies. A DIN your unique identifier. Any director of a company or of a registered entity under the Corporations Act 2001 must acquire a DIN. It is free to apply.
A Director Identification Number is:
- Verification of a company director’s identification
- A 15-digit number, beginning with 036 (a 3-digit country code for Australia under ISO 3166) and ending with an 11-digit number plus one ‘check’ digit for the purpose of detecting errors
- Unique to a person and does not change even if a director changes job title, leaves a company, changes their name or moves interstate or overseas
The purpose of this DIN register is to help:
- Prevent director involvement in unlawful activities
- Prevent fraudulent use of director identities
- Prevent false director identities from being created
- Authorities to trace – in real time – directors’ business relationships and their business activities within companies
- Create fairness in a more equitable business environment because wrongdoings by directors can be traced
1. How to apply?
*Online application- A myGovID with either a Standard or Strong identity strength. If you don’t have one, visit How to set up myGovID
- An individual Australian tax file number (TFN). Providing your TFN is optional, but it speeds up the process.
- Your residential address, as recorded by the Australian Taxation Office (ATO).
- Answers to two questions based on details ABRS knows about you, see more details to verify your identity.
Applicants within Australia
The fastest way to receive your director ID is to apply online.
To complete your online application, you need the following information to verify your identity.
If you can’t get a myGovID with a Standard or Strong identity strength, the best way to apply for a director ID will depend on your situation.
*Apply by phone
- an Australian tax file number (TFN)
- your residential address as held by the Australian Taxation Office (ATO)
- answers to two questions based on details ABRS knows about you, see more details to verify your identity.
- two Australian identity documents – one primary and one secondary.
Applicants within Australia
You can apply by phone if you have:
*Apply with a paper form
- Foreign birth certificate
- Foreign passport
- National photo identification card
- Foreign government identification
- Driver’s licence, as long as the licence address matches the address details on your application
- Marriage certificate, but if you use this document to verify your change of name, you can’t use it as a secondary document.
- marriage certificate
- deed poll
- change of name certificate.
- Do not send original documents as these will not be returned to you.
- If you can’t provide certified copies of your paper identity documents with your application form please contact ABRS office.
- If you don’t meet your obligations as a Director there may be civil or criminal penalties or you may be issued with an infringement notice.
Applicants within Australia
If you can’t apply online or over the phone, you can apply using a downloadable form– Application for a director identification number (NAT75329, PDF, 306KB). This is a slower process and you will also need to provide certified copies of your documents to verify your identity.
Applicants outside Australia
In addition to the information requested on the application form, you will need to provide certified copies of one primary and one secondary identity document.
Primary documents
Secondary documents
2. Once you have your Director ID please print or save a PDF file of your Director ID.
3. Send your Director ID PDF file to
contact@ymlgroup.com.au to update our record. Should you need assistance with your application for a DIN, YML Group has the expertise to determine your company position status and to assist you with your DIN application.How can YML help?
Talk to our YML Chartered Accountants Team today to see how YML Group can assist you with your Director ID. For more information, view our website and contact us on (02) 8383 4400 or by using our Contact Us page on our website.
