Wednesday, October 22, 2008

What if an employee has a Do-it-Yourself fund?

So an employee of yours has given you details of her own "Do-it-Yourself" fund and you want to know whether this is OK.

Rather than choose a retail fund to receive and administer super contributions, some employees have chosen the option of setting up their own self-managed fund. Provided that the employee has established the DIY fund properly it is quite all right to pay super contributions into such a fund.

If you as an employer registers with Superconnect you will find it quite easy to make payments to any DIY fund as Superconnect specializes in working with DIY funds. You must however ensure that you obtain the correct details in order to make payments to such a fund. When you register with Superconnect you can obtain a list of information you will need when making payments to the DIY fund.

If an employee is considering establishing a DIY fund they need to know that running such a fund is not for the feint hearted. Running a fund requires that the employee needs to comply with legal and tax requirements, as well as making investment decisions and fund administration. Generally a lawyer or tax accountant can direct your employee to the right channels to establish a DIY fund.

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