One of the great times to have an SMSF is once pensions start. The flexibility they offer allows members to implement great tax planning decisions without any of the hassle or fuss of a large fund. But some thinking in advance is still invaluable.

Just before Christmas, there was another small step towards resolution for those with “legacy pensions” with some new draft legislation being released for comment.

The announcement of a two year amnesty, possibly starting as soon as 1 July 2022, was music to the ears of anyone dealing with market linked, complying lifetime or complying life expectancy pensions.

The general TBC will increase to $1.7m from 1 July 2021. The quirky method for translating that to individual clients will create plenty of confusion. It is fertile ground if the government really is keen to simplify laws and remove red tape.

Meg Heffron answers why it’s not possible for SMSF members to top up their pension balance - even though it has dropped below the $1.6m pension cap - if the cap had been reached previously. - Originally published in "Australian Financial Review"

Legislation introduced to fix a problem with market linked and complying life expectancy pensions, but it's not a total solution for all.

Does ECPI continue on my reversionary pension even though it will put me over my Transfer Balance Cap?

With the 1 July 2017 introduction of the $1.6m Transfer Balance Cap came a new obligation on superannuation fund trustees to report certain member “events” to the ATO. These events are reported using a “Transfer Balance Account Report” or TBAR.

A great many retired SMSF members with large superannuation balances adjusted their pension accounts back to $1.6 million on 30 June 2017.

The TBAR system revolves around the reporting of “events”, hence the name “events-based reporting”.

The timing of Transfer Balance Account Reports for SMSFs has been hotly debated ever since the ATO first flagged its view that this should occur outside the normal annual return cycle. The final verdict is now in.