Simeoni Newsletter Summer Edition 2013

Inside this issue

- Paul's Introduction
- Paul's Fearless Predictions
- Self Managed Superannuation Fund Borrowing Structure
- Cooking with Candice

Paul's Introduction 

Paul's Fearless Predictions

With 6 out of 10 predictions in the 2013 year correct, I will take it as a successful outcome. 

Now for the 2014 predictions, I have Mr Sheened the crystal ball and am feeling more confident for the next year.

The results for the 2013 predictions are as follows

Total Score: 6/10

1)	The Australian unemployment rate will hit 6%	X	5.8%
2)	GDP in Australia will not reach 3%	V	2.6%
3)	Liberal/National Party will win at least 90 seats in 2013 elections	V	Liberal National Party 90
4)	William and Kate will announce they will be expecting their first child	V	Prince George
5)	UNSW Blues to finally win 2013 State of Origin series	X	Lost 2-1
6)	Socceroos will qualify for the 2014 Brazil World Cup	V
7)	Australian Share Market Index to pass the 5800 during the year	X	5437 at its highest to date
8)	Cuban President Fidel Castro will pass away during the year	X	Still alive
9)	Manchester United to win the English Premier League 2013	V	20th Title – 2 more than Liverpool
10)	A large motor vehicle manufacturer will announce a closure of one of its manufacturing plants in Australia	V	May 2013 Ford announced closure of manufacturing in Australia after 88 years

Paul's predictions for 2014 are...

1)	Brazil will win the 2014 World Cup Football.
2)	Australian share market will finally reach 5800 mark.
3)	The NSW State Government will record its first actual budget surplus in over a decade.
4)	Australia to win at least 1 gold medal in the 2014 winter Olympics.
5)	Interest rates to increase by 25 to 50 basis points during the year.
6)	Gay marriage will be legal in at least one of the states in Australia.
7)	Brad Pitt and Angelina Jolie will separate during the year.
8)	Prince Harry will announce his engagement during the year.
9)	Sydney Swans will win the AFL title in 2014.
10)	Australia will win the medal tally at the 2014 Commonwealth Games.

Self Managed Superannuation Fund Borrowing Structure

One of the most frequently asked questions this year is about Self Managed Super Funds (SMSF) and the ability to borrow to purchase property. 

It is imperative that anyone interested needs to understand the concept and the structure properly. One mistake in the setup or strategy can turn out to be a very expensive mistake. The ATO will be targeting this strategy in the next few years, knowing that if the structure isn’t correct there will be a significant revenue boost for them.

Below is a basic SMSF/ Bare trust borrowing arrangement. It also explains the relationships amongst the structures.

Typical limited recourse borrowing arrangement set-up

Corporate Trustees

  

Please note:

• Red arrows represent the legal processes that occur for the limited recourse borrowing arrangement to be implemented correctly.

• Black arrows represent the relationship between the two trust structures, the Fund Trustee, the Bare Trustee and the SMSF Members. 

• The SMSF & Bare Trust Deed cannot have the same trustee, however, they can have the same directors of different corporate trustees.

• The member or members of an SMSF can also perform the function of the Lender, and it is up to the Lender and SMSF Members to determine the loan security, and the frequency and structure of repayments. If a financial institution is the Lender and requires additional security over the amount borrowed then, professional advice should be obtained. 

BAKED RICOTTA LEMON CHEESECAKE