Self Managed Superannuation Fund (SMSF)

Australians have the choice of putting their personal super contributions with an independently managed superannuation fund or with a self managed super fund.(SMSF). You are able to invest in a broad range of investments including: cash, fixed interest, managed investments, Australian shares, International shares and property among other things.

SMSF’s perform the same role as any other super fund, by investing contributions and making them available to members upon retirement. The key difference is that the members of SMSF’s are also the trustees and therefore control where their contributions are invested and how payments are to be made, as long as you comply with superannuation law.

What is a self managed super fund?

A Self Managed Super Fund consists of the following (with a few exceptions):

  • Has a trust deed that meets the requirements of the Superannuation Industry (Supervision) Act 1993 (SIS Act).
  • Has a maximum of four members.
  • Each member of the fund is a trustee.
  • A single member of the fund cannot be an employee of any other member of the fund, unless they are related.
  • A trustee of the fund cannot receive any remuneration for their services as such.

Some of the reasons you may choose to establish a self managed super fund are:

  • Control
  • Flexibility in investment decisions
  • Estate planning
  • Cost efficiency

However, along with the benefits comes the respective responsibility of establishing and maintaining a SMSF.

These responsibilities may include:

  • Ensuring (in conjunction with your administrator) that the fund complies with all the relevant laws at all times of the year.
  • Keeping your super fund’s records (including bank accounts) separate to those for your other personal or business interests.
  • Ensuring your super fund’s investments are held in the correct names.
  • Investing the fund assets prudently in a way that meets your funds investment strategy, therefore providing for your retirement.

As a general rule, a SMSF may be suitable for you if:

  • Your asset balance will probably reach more than $100,000 within 12 months of the fund being established.
  • You are at least seven years away from retiring with an expected balance of more than $200,000 within 12 months of the fund being established.

This is all dependent upon your individual circumstances, goals and needs.

At Wealth Solution Partners we have dedicated superannuation professionals ensuring your self managed superannuation fund abides by all the rules.