Tax File Number (TFN)
A unique identifying number issued to individuals and organisations by the Australian Taxation Office to increase the efficiency in administering tax and other Commonwealth Government systems such as income support payments.
Tax Free Component of a Superannuation Benefit
The tax free portion of your superannuation account. This will include any pre-July 1983 component, the Capital Gains Tax exempt component, the post June 1994 invalidity component, the concessional component, and all non-concessional (after-tax) contributions.
The portion of your super on which you will be taxed if you take a superannuation benefit before turning 60. This includes the post-June 1983 component and the non-qualifying component.
Tax Data Extract
An XML file created during Mclowd end of year processing containing all data needed to complete your Fund’s tax return. This file can only be created if you have purchased the optional Paid Extra referred to as Online Lodgement. It is created using a button that will appear on the Financial Periods screen if you have purchased the paid extra for the tax year you are closing. You can optionally import this file into LodgeIT to automate the completion and submission of your Fund’s tax return.
A cash deposit that pays a set interest rate over a specified investment timeframe.
Terms of Service
The legal terms under which Mclowd offers service to users. You can find Mclowd’s terms of service at https://www.mclowd.com/terms-service/.
A projected sum calculated to take into account the loss of value of money over time due to inflation. Stating your superannuation balance in ”today’s dollars” rather than in actual value gives a better indication of what that balance is likely to buy when you retire, or at some other future date. For example, you might have been pleased to have $500,000 in your super account in 1991, but you would have needed $919,865 in ”today’s dollars” to have the same buying power in 2016.
Total and Permanent Disability (TPD) Cover
Insurance that provides a lump sum payout if you become totally and permanently disabled and therefore unable to earn a living.
The average price calculated by weigh the filled buy (or sell) prices of an order according to the respective volume of shares bought (or sold) at each price.
A cash account used by funds to receive income and pay day-to-day expenses, as well as taking up investment opportunities that may arise. Funds may permit members to hold personal transaction accounts that attract lower returns but provide liquid funds for them to take advantage of opportunities to purchase segregated assets.
Transition to Retirement
Your superannuation account can be in accumulation phase, pension phase, or transition to retirement phase.
Transition to retirement means that you can withdraw your super benefits while still working part time or casually and contributing to super.
To operate a Transition to Retirement superannuation account,
- You must have reached your preservation age.
- You must withdraw, during each financial year, at least 4% of the value of your pension account (as at 1 July) and no more than 10% of the value of your account.
- Except in special circumstances (or if you have unrestricted non-preserved benefits in your TRIP account), you cannot convert your Transition to Retirement account to a lump sum unless you retire, turn 65, or otherwise satisfy a condition of release.
If you operate an SMSF, your pension account must be kept separate from the super account that accepts contributions.
Transition to Retirement Account
A type of member account held by members transitioning to retirement. This account type provides for members to continue to contribute and accumulate retirement savings while drawing a pension. It is generally suitable for members working part time or casual.
A legal document setting out the rules governing the operation of a superannuation fund. Very fund must have a Trust Deed and it should be updated periodically to ensure it complies with current legal requirements. Members are entitled to view a copy of their fund’s trust deed.
Investors in Managed Funds and other investment trusts may periodically receive distributions from fund trust profits. These distributions will frequently include capital gains, foreign income, and various kinds of tax exempt, tax favoured or pre-taxed income. Trust managers will typically provide statements at the end of each financial year detailing the sources of income, tax status, and amount of income paid to you, as an investor, from each source. These statements are often complicated. Mclowd’s ”Trust Distributions” screen, under Taxable Income, allows for entry of the information provided by Trusts into the system to enable taxable income and deductions relating to Trust Distributions to be correctly computed and factored into your fund’s tax return. Labelled columns have been provided for entry of various classes of income and tax credits and Mclowd developers have endeavoured to match labels as closely as possible to the labels typically used on Trust Distribution statements issued by the popular Managed Funds. However, to depending on the formats used by the Trusts in which your fund is invested, you may need professional assistance to correctly complete this section. It is important to ensure this screen is filled in correctly, as you may lose valuable tax credits if there are errors.
Persons or corporate body that is legally responsible for the running of a fund in accordance with law and the terms of the fund’s Trust Deed. The trustee must act in good faith and in the best interests of members. The Australian Securities & Investments Commission (ASIC) and Australian Prudential Regulation Authority (APRA) regulate the conduct of Trustees.
SMSFs can have either a corporate trustee or individual trustees. If you opt for individual trustees, every member of the fund must be a trustee, and a sole member SMSF must have at least two individual trustees. If you elect to appoint a corporate trustee for your SMSF, each member of the fund should be a director of the trustee corporation. There are significant benefits to having a corporate trustee in terms of administration, success, and asset protection.