EING your own boss has plenty of advantages but compulsory super is often not one of them. When you work for an employer, they are obliged to contribute the current minimum of 9.5 per cent of your salary into super in what is known as a super guarantee payment.
The same situation doesn't apply to the self-employed, who have to choose to contribute to their own super, which means some simply don't get around to doing it.
The long term super benefit of providing a retirement income can be very important if you are running a small business.
Superannuation funds often provide costeffective insurance cover for death and disability. So the first tip is to set up a super account with low costs and a sound investment record and secondly, consider contributing to it as if it was compulsory.
There are some other important tax benefits for the self-employed, the primary one being that you can claim a full tax deduction for your super contributions.
Another very valuable concession for the self-employed is the ability to be exempt from capital gains tax of up to $500,000 if you sell a small business asset.
If you are under 55, you must roll over the proceeds into a super fund in order to claim the exemption. Those aged 55 or over can choose to roll over the proceeds to a super fund.