Month: October 2026

Superannuation law requires trustees of SMSFs to formulate, regularly review and give effect to an investment strategy that has regard to the whole of the circumstances of the fund. Although there is nothing in the law stating a timeframe that may define ‘review regularly’, it is commonly accepted that this would be at least annually. This aligns with comments on the ATO’s website where they expect reviews to occur at least annually.

Some trustees will undertake an annual review leading up to, or at the beginning of a new financial year, while others will undertake the review as part of reviewing the completed financial accounts from the previous financial year. Neither is the right or wrong option, and you must consider what is best for your situation.

Either way, you will need to be able to show your fund’s auditor that you have reviewed the investment strategy and documented any decisions made, whether it be recording changes deemed necessary or determined the existing strategy remains appropriate.

There may be other times that it is appropriate to review the investment strategy. These may include when:

• There is a market correction;
• A member joins or leaves the fund;
• A member starts a pension in the fund.

An investment policy will generally be comprised of two parts:

1. Investment objective – this part outlines the fund’s objectives and expected outcomes. For example, an objective may be to achieve a certain level of return over a certain period. This would generally take into account the age of the members, their retirement needs and investment risk profile.
2. Investment strategy – this part outlines how the fund will achieve the stated objectives. For example, it may include investment asset ranges or specific assets that will be held.

When reviewing your fund’s investment strategy, consideration must be given to:

• The risk of holding particular investments and their returns, with regards to the fund’s objectives and expected cashflow requirements;
• Composition of investments and the risk of inadequate diversification;
• Liquidity of investments, with regards to expected cashflow requirements;
• Ability to discharge existing and prospective liabilities; and
• Whether insurance cover for one or more members should be held by the fund.

Although these points need to be considered, it is up to the trustees to determine how they are applied, based on the circumstances of the fund.

As an example, you must consider the diversification of the fund’s assets, but that does not mean you are required to have a diversified investment strategy. Many funds hold just a property and a bank account, and this may be appropriate for those funds. However, the trustees should document what consideration they gave to diversification, why the lack of diversification is appropriate and why they have chosen these particular assets.

Likewise, there is no legal requirement to hold insurance cover for the members, but you do need to document that it has been considered.

As noted above, a member starting a pension may be reason to review the fund’s investment strategy. This is due to the fact that this is likely to change the liquidity considerations and investment profile of the fund. When members are all in the pre-retirement growth phase, expenses are usually more predictable and there isn’t a need for many funds to hold large cash reserves. Once members reach the point they are accessing their benefits, as either pension or lump sum payments (or both), cashflow, liquidity and a potential cash buffer become a more important consideration.

It is not uncommon that leading up to the end of any given financial year we will field enquiries and concerns from trustees that do not have the cash to satisfy even the minimum pension requirements for the year. While there may be several reasons for this, it should raise questions about the appropriateness of the fund’s current investment strategy and considerations as to whether a review of the asset holdings is warranted.

If we revisit the one property and one bank account funds mentioned early, this may have been a reasonable strategy during the growth phase, but does it remain so during the drawdown phase?

Although many people are comfortable with property and Australian investors in general have an affinity for the old bricks and mortar, this does not mean it is an appropriate investment in all circumstances. If the rental income from the property cannot support your retirement needs and minimum pension withdrawal requirements, something needs to change. This will hold true for any other investment that may not be easily sold, such as holdings in unlisted companies and trusts.

Reviewing your fund’s investment strategy and giving consideration to the needs of the members and the asset holdings of the fund should not be seen as just a tick-a-box legal requirement. You’ve worked hard to build you retirement wealth and when the time comes, you want to be able to enjoy it. Having an appropriate investment strategy that will allow this is an important element of running an SMSF. Have you reviewed your strategy lately?

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If you spend time outside Australia for work, family or personal reasons, your travel history could become increasingly important when it comes to your Australian tax affairs.

On 24 August 2026, the ATO gazetted its latest passenger movements data-matching program. Under the program, the Department of Home Affairs is expected to provide the ATO with travel information for around 115,000 individuals each year from the 2026–27 income year through to 2028–29.

The information may include an individual’s name, date of birth, arrival and departure dates, passport details and citizenship or visa status. The ATO can then compare this information with its own records to identify potential issues with tax residency, registration, lodgement, reporting and payment obligations.

For taxpayers who regularly travel overseas, one of the most important areas to consider is their tax residency position.

Why tax residency matters

Your Australian tax residency status can have a significant impact on how you are taxed.

For example, Australian residents are generally taxed on their worldwide income, while foreign residents are generally taxed only on their Australian-sourced income. Residency can also affect the tax-free threshold, Medicare levy obligations and capital gains tax (CGT) outcomes.

This means that where you have moved to or from Australia, or spent extended periods overseas, the exact dates you entered and left Australia can be important when preparing your tax return.

The ATO will now have access to passenger movement information from an independent government source. If the dates reported by a taxpayer do not appear to align with those records, this could potentially prompt the ATO to seek further information.

Importantly, spending time overseas does not automatically make someone a foreign resident for tax purposes. Tax residency is determined by considering a range of factors, including family circumstances, the strength of connections with Australia and someone’s intentions and behaviour. However, accurate travel records can be an important part of establishing the overall position.

When could your travel history matter?

There are several situations where keeping accurate travel records could be particularly useful.

Part-year residency

If you became or ceased to be an Australian tax resident during the year, the dates you arrived in or departed Australia may form part of the evidence supporting your residency position. They can also be relevant when determining whether a part-year tax-free threshold applies.

Working overseas

If you regularly travel overseas for work, your travel history may help establish when you were working in Australia and when you were overseas. This can be particularly relevant where your tax position involves foreign employment income, work-related travel or other overseas activities.

Selling an Australian property

If you have moved overseas and later sell an Australian property, your residency history can be relevant to the CGT treatment. An individual’s tax residency status can have a significant impact on whether the main residence exemption can apply on sale of someone’s home, so keeping a clear record of when you were living in Australia and when you were overseas can be helpful.

What should you do?

There is no need to be concerned simply because you travel overseas. However, if you spend significant periods outside Australia, it is worth making sure your records are accurate and consistent.

As a practical starting point:

• Keep a record of your arrival and departure dates for each trip, including the year in which the travel occurred.
• Retain useful supporting records such as flight itineraries, boarding passes and passport records where available.
• Let us know about significant periods spent overseas, particularly if you have moved overseas or are considering doing so.
• Before lodging your tax return, check that the dates used in any residency calculation or other relevant tax treatment are accurate.

Good record-keeping is particularly important where your residency position is not straightforward. If there is a difference between the dates you have reported and the information available to the ATO, having supporting records can make it much easier to explain the position.

A small detail that could make a big difference

For most taxpayers, the ATO’s passenger movements data-matching program is unlikely to have any direct impact. However, for people who regularly travel overseas, have moved countries or have a residency position that is finely balanced, accurate travel records could become increasingly valuable.

Rather than waiting for the ATO to raise a query, it is worth discussing your circumstances with us if you have spent substantial time overseas during the year or plan to in the near future.

A few minutes spent checking your travel dates and residency position could help avoid unnecessary questions later and provide greater confidence that your tax return accurately reflects your circumstances.

Image by Josh Withers on Unsplash