need to complete 2 word documents
Units: FNSASICU503, FNSFPL502, FNSFPL503, FNSSMS501, FNSSMS505, FNSSMS601, FNSSMS602, FNSSMS603 Diploma of Financial Planning Module 3 Assignment Submission Instructions: Key steps that must be followed: 1. Please complete the Declaration of Authenticity at the bottom of this page. 2. Once you have completed all parts of the assessment and saved it (e.g. to your desktop computer), login to the Monarch Learning Management System (LMS) to submit your assessment. 3. In the LMS, click on the file ”Submit DFP Module 3 Assignment” in the Module 3 section of your course and upload your assessment file/s by following the prompts. 4. Please be sure to click “Continue” after clicking “submit”. This ensures your assessor receives notification – very important! Click here to go to the Monarch LMS Declaration of Authenticity* I certify that the attached material is my original work. No other person’s work has been used without due acknowledgement. I understand that the work submitted may be reproduced and/or communicated for the purpose of detecting plagiarism. Student Name*: Date: * I understand that by typing my name or inserting a digital signature into this box that I agree and am bound by the above student declaration. Important assessment information Aims of this assessment This assessment covers the fundamentals of superannuation. It covers rules around contributing to superannuation such as the work test, as well as contribution limits (both concessional and non-concessional). Salary sacrifice strategies are addressed, as are the differences around a superannuation fund in accumulation phase versus pension phase. Tax consequences across contributions to super, money held within the accumulation phase, and lump sum withdrawal of benefits (inclusive of pension payments) is also explored. SMSFs are addressed including important tests such as the sole purpose test, and in-house asset test. The use of business real property including in-specie contributions into superannuation is also addressed in the context of SMSF strategies. Marking and feedback This assignment contains 4 assessment activities each containing specific instructions. This particular assessment forms part of your overall assessment for the following units of competency: · FNSASICU503 · FNSFPL502 · FNSFPL503 If you are enrolled in SMSF units, the following units are also applicable. · FNSSMS501 · FNSSMS505 · FNSSMS601 · FNSSMS602 · FNSSMS603 Grading for this assessment will be deemed “competent” or “not-yet-competent” in line with specified educational standards under the Australian Qualifications Framework. What does “competent” mean? These answers contain relevant and accurate information in response to the question/s with limited serious errors in fact or application. If incorrect information is contained in an answer, it must be fundamentally outweighed by the accurate information provided. This will be assessed against a marking guide provided to assessors for their determination. What does “not-yet-competent” mean? This occurs when an assessment does not meet the marking guide standards provided to assessors. These answers either do not address the question specifically, or are wrong from a legislative perspective, or are incorrectly applied. Answers that omit to provide a response to any significant issue (where multiple issues must be addressed in a question) may also be deemed not-yet-competent. Answers that have faulty reasoning, a poor standard of expression or include plagiarism may also be deemed not-yet-competent. Please note, additional information regarding Monarch’s plagiarism policy is contained in the Student Information Guide which can be found here: http://www.monarch.edu.au/student-info/ What happens if you are deemed not-yet-competent? In the event you do not achieve competency by your assessor on this assessment, you will be given one more opportunity to re-submit the assessment after consultation with your Trainer/ Assessor. You will know your assessment is deemed ‘not-yet-competent’ if your grade book in the Monarch LMS says “NYC” after you have received an email from your assessor advising your assessment has been graded. Important: It is your responsibility to ensure your assessment resubmission addresses all areas deemed unsatisfactory by your assessor. Please note, if you are still unsuccessful in meeting competency after resubmitting your assessment, you will be required to repeat those units. In the event that you have concerns about the assessment decision then you can refer to our Complaints & Appeals process also contained within the Student Information Guide. Expectations from your assessor when answering different types of assessment questions Knowledge based questions: A knowledge based question requires you to clearly identify and cover the key subject matter areas raised in the question in full as part of the response. Skill based questions: Where you are asked to write as though you are speaking to a client, your answers must show your ability to: · understand your client’s concerns/perspective/views · show empathy · display a professional response · explain ideas clearly and simply so your client can understand the issues Good luck Finally, good luck with your learning and assessments and remember your trainers are here to assist you Assessment Activity 1 Short Answer Superannuation Activity instructions to candidates · This is an open book assessment activity. · You are required to read this assessment and answer all 10 questions that follow. · Please type your answers in the spaces provided. · Please ensure you have read “Important assessment information” at the front of this assessment · Estimated time for completion of this assessment activity: 2-3 hours Question 1.1 Describe a market-linked fund. Question 1.2 Describe a defined benefit. Question 1.3 The bring-forward rule allows a fund member to bring forward two years of non-concessional contributions from the future if they under age 65. From 1 July 2017, for people under 65, what are the maximum bring forward limits based on their total superannuation account balance? Explain your answer. Question 1.4 Alice believes you may as well die when you retire, so she chooses to continue to work on a casual basis at Bunnings.She is 68 years old and works exactly 30 hours each month of the year. She wants to contribute her own funds into superannuation, and seeks your advice as to whether she is able to contribute to super to top it up. Can she contribute into her super fund, based on her age? Why or why not? Question 1.5 Using an example, explain how salary sacrificing can reduce a person's marginal tax rate. Question 1.6 Could all employees benefit from salary sacrificing some of their salary into superannuation? Explain your answer. Question 1.7 Complete the following table to show that you understand the way that fund earnings are taxed in the superannuation environment effective from 1 July 2017. Earnings tax on income returns Earnings tax on capital returns Accumulation phase Transition to retirement income stream phase Retirement income stream phase Question 1.8 Explains the 'pension benefits cap'. What phase of superannuation does this cap apply to? Question 1.9 Your clients are Mr and Mrs Jones. They are in their mid-50's and they are planning for their retirement in 10 years’ time. Mr Jones has a much higher superannuation balance than Mrs Jones and the pension benefits cap is a concern for him in the future. Explain the concept of 'contributions splitting' and how it could help Mr and Mrs Jones plan for the future. Question 1.10 Nicholas pays tax at a marginal tax rate (MTR) of 37% plus the Medicare Levy of 2%. What is the benefit of receiving fully franked dividends in his SMSF compared with receiving fully franked dividends in his own personal name? Assessment Activity 2 Case Study Superannuation Activity instructions to candidates · This is an open book assessment activity. · You are required to read this assessment and answer all of the following questions. · Please type your answers in the spaces provided. · Please ensure you have read “Important assessment information” at the front of this assessment · Estimated time for completion of this assessment activity: 2-3 hours Question 2.1 Lisa is 59 years old and has permanently retired from the workforce. She has come to your office to seek advice in regards to her superannuation. Lisa has $350,000 in her superannuation accumulation fund which comprises $70,000 as a tax free component and $280,000 as a taxable component (from a taxed source). Lisa is planning to go on an extended overseas holiday with her daughter and would like to spend a year in Paris. She has a few questions she wants you to clarify. Provide a clear explanation to Lisa for each of the following. a. Can Lisa access her tax free component first as she wishes to use the $70,000 towards her trip and would rather keep the remaining $280,000 invested? b. How much of the total $350,000 can Lisa access as a lump sum withdrawal from her superannuation accumulation fund, without having to pay any tax at all on that withdrawal? c. At what age can Lisa access all her funds tax free? Question 2.2 Lisa's friend Sophie is 61 years old and she is considering meeting up with Lisa and her daughter for a few months in Italy. Sophie is also retired and she has a superannuation balance of $500,000 in an account-based pension which comprises $100,000 as a tax free component and $400,000 as a taxable component (from a taxed source). Provide a clear explanation to Sophie for each of the following. a. Both Lisa's fund and Sophie's fund are producing investment returns of 5% per annum. Are the investment returns treated any different for tax purposes in Sophie's fund compared with Lisa's fund? b. What are the minimum and maximum amounts that Sophie must withdraw annually from her account-based pension? c. If Sophie withdraws a total of $100,000 in the current financial year, will it come from the tax-free component or the taxable component? d. How will the $100,000 withdrawal be taxed? Question 2.3 Sophie's friend Bethany is 59 years old and continues to work. Bethany's superannuation balance of $400,000 is in a transition to retirement pension account and comprises $100,000 tax- free component and $300,000 taxable component (from a taxed source). Provide a clear explanation to Bethany for each of the following. a. Assuming that Bethany's fund produces an investment income return of 6% for the 2017-2018 financial year, explain the tax treatment of the return. b. If Bethany withdraws pension payments totaling $20,000 for the year, how will this be treated for tax purposes? c. When Bethany turns 60 and continues to withdraw $20,000 for the year, how will the withdrawal be treated for tax purposes? Assessment Activity 3 Case Study Superannuation –Death benefits Activity instructions to candidates · This is an open book assessment activity. · You are required to read this assessment and answer both questions. · Please type your answers in the spaces provided. · Please ensure you have read “Important assessment information” at the front of this assessment · Estimated time for completion of this assessment activity: 1-2 hours Question 3.1 Matthew