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U1 and U2 Forestry managed investment scheme expense

Last updated 29 March 2021

Did the SMSF incur expenses for a forestry managed investment scheme (FMIS)?

No

Leave U1 and U2 blank. Go to L1 and L2.

Yes

Read on.

Write at U1 and U2, as required, the amount of forestry managed investment scheme expenses that the SMSF incurred in 2017–18.

Deductible forestry managed investment scheme expenses

Write at U1 the total amount of deductible payments made under an FMIS.

Do not include at U1 payments (or any part of such payments) that relate to earning:

You can read more about calculating deductible FMIS payments at Forestry managed investment schemes.

If the SMSF pays retirement phase superannuation income stream benefits to a member, refer to How are expenses treated when an SMSF has ECPI? before you claim a deduction for the SMSF's FMIS expenses.

Non-deductible forestry managed investment scheme expenses

Write at U2 the total amount of payments made under an FMIS that are not deductible The SMSF cannot claim a deduction for certain excluded payments. For more information see Forestry managed investment schemes.

The SMSF cannot claim a deduction for payments if the income from the FMIS is exempt income, such as exempt current pension income.

For information on the SMSF's eligibility to claim deductions, if the SMSF incurred expenses to do with a collapsed agribusiness managed investment scheme, then see Collapse and restructure of agribusiness managed investment schemes – participant information.

Start of example

Example 'SMSF with no ECPI': FMIS expenses

SMSF U has no exempt current pension income, foreign income or non-arm's-length income.

SMSF U is entitled to a deduction of $800 for payments made to an FMIS in 2017–18.

SMSF U reports:

I1 Deductible forestry managed investment scheme expenses $800

I2 Non-deductible forestry managed investment scheme expenses (Blank)

End of example

 

Start of example

Example 'SMSF with ECPI': FMIS expenses

SMSF UU pays retirement phase superannuation income stream benefits to one of its three members and some of its income is exempt from income tax under the exempt current pension income rules.

SMSF UU made payments of $800 to an FMIS in 2017–18.

Using the rules described at How are expenses treated when an SMSF has ECPI? SMSF UU determines that $200 of the payments relate to earning its ECPI.

SMSF UU reports:

I1 Deductible forestry managed investment scheme expenses $600

I2 Non-deductible forestry managed investment scheme expenses $200

End of example

QC55254