SMSF overview

A large number of Australians are making the decision to establish their own Self-Managed Superannuation Fund (SMSF).

SMSF’s allow members to have greater control whilst providing flexibility over their superannuation. SMSF’s have the ability to invest in a significantly wider range of investments (including property – and also the possibility of borrowing to acquire property). SMSF’s can also be used as an effective Estate Planning tool.

What is a Self-Managed Superannuation Fund (SMSF)?

A Self-Managed Superannuation Fund (SMSF) is a trust where money or assets are held and managed on behalf of members to provide retirement income in the future. Essentially, SMSF’s are for family members and close business associates who wish to take more control of their retirement savings.

Briefly, a SMSF is defined in the following way:

  • has 4 members or less;
  • all members must be trustees and all trustees must be members (except for single member funds);
  • where the trustee is a company, all members must be directors of the trustee company and all directors must be members of the fund (except for single member funds);
  • no member of the fund can be an employee of another member unless they are related; and
  • the trustee cannot receive any remuneration for fulfilling his or her duties as a trustee of the fund.

What are the advantages of establishing a SMSF?

For many people the greatest advantage of a SMSF is the greater control, flexibility and investment choice they provide. Through a SMSF you have:

  • Greater control over the investment strategy for the fund
  • A wider range of investment options such as direct property, small businesses and even art.
  • A SMSF can be tailored to meet your own personal circumstances in relation to estate planning.
  • The ability to borrow via the SMSF to purchase an allowable asset.
  • Member superannuation accounts can be taxed at a member level rather than at a fund level, compared to many retail master trusts and industry superannuation funds.

It is also important to note that the costs associated with the management of a SMSF, including ensuring compliance with all regulations, generally means that the fund members collectively need around $200,000 to make the exercise of establishing the SMSF worthwhile.

For more information on issues to consider before setting up a SMSF click here.

As experts on SMSFs, Required Financial Services can assist you with the establishment of a SMSF, and provide you with advice about investment and borrowing strategies for your SMSF that is personalised to your situation and goals.

Click here to have one of our experienced advisers contact you

Required Financial Services Pty is an Authorised Representative of Consultum Financial Adviser Pty Ltd, ABN 65 006 373 995, AFSL 230323, Consultum is part of the IOOF group
Download Our Financial Services Guide
Privacy Policy
Powered by Web Force 5 Required Finance Pty Ltd ABN: 76 909 843 413, Credit Representative No. 420133 National Mortgage Brokers Pty Ltd ABN: 88 093 874 376 Australian Credit License No. 391209