For my SMSF in retirement phase, how are distributions that contain capital gains treated?

For my SMSF in retirement phase. How are distributions (e.g. Vanguard ETFs) – treated that contain elements of capital gains? There’s lots of talk about how bad it is to receive capital gains in your distributions but how does this apply to SMSF esp. those in retirement mode?

A: If you are in pension mode, your tax rate is 0% and you aren’t paying any tax. You are indifferent to whether it is a capital gain or other income.

Each funds provides a yearly tax statement which sets out the components of the distribution. As a pensioner, the only things that you care about are any franking credits – because these are refundable.

 


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