Take control of your
retirement with your
Self-Managed Super Fund.
Looking after your financial well being
It’s important to seek professional advice before setting up an SMSF. We can help you determine if an SMSF is the right choice for your retirement savings, and that you understand the responsibilities involved.
Super, self managed.
An SMSF (Self Managed Super Fund) is a private superannuation fund that you manage yourself. It's a way of saving for your retirement, where you have control over the investment strategy and the types of investments made.
Setting it up
Generally, anyone who is 18 years old or older and not under any legal disability (such as bankruptcy or mental incapacity) can set up an SMSF.
Benefits of SMSFs
The main benefits include greater control over investments, potential cost savings, tax advantages, and flexibility in estate planning.
Borrowing to Invest
We often get asked by clients if they can borrow money in their SMSFs to invest. The answer is yes – SMSFs can borrow money to invest in certain assets through a limited recourse borrowing arrangement (LRBA). However, there are strict rules governing this.
Frequently asked
Questions? We’ve got plenty of answers.
What is an SMSF?
An SMSF is a private superannuation fund that you manage yourself. It’s a way of saving for your retirement, where you have control over the investment strategy and the types of investments made.
How many members can an SMSF have?
An SMSF can have up to six members. Each member must be a trustee of the fund, or a director if the fund has a corporate trustee.
What are the responsibilities of SMSF trustees?
Trustees are responsible for managing the fund’s investments, ensuring compliance with superannuation laws, preparing and lodging annual returns, and ensuring the fund is audited annually.
What are the investment restrictions for SMSF?
SMSFs are prohibited from investing in certain assets, such as loans to members or their relatives, assets acquired from related parties that are not at arm’s length, and investments that do not meet the sole purpose test of providing retirement benefits to members.
What are the borrowing conditions?
SMSFs can borrow money under specific conditions through a Limited Recourse Borrowing Arrangement (LRBA). Under an LRBA, an SMSF can borrow money to acquire certain types of assets, subject to strict legal requirements.
The main purposes for which an SMSF can borrow money include:
Purchasing Property: SMSFs can borrow to buy residential or commercial property. The property must be held in a separate trust, and the SMSF has beneficial ownership of the property
Investing in shares and other financial assets: SMSFs can borrow to invest in shares, managed funds, and other financial assets.
The borrowed funds must be used to acquire a single asset or a collection of identical assets with the same market value
It’s important to note that the borrowed funds cannot be used for improvements or renovations of the property that would fundamentally change its character. However, repairs and maintenance are allowed.
How is an SMSF taxed?
SMSFs are taxed at a concessional rate of 15% on income, including rental income and capital gains. However, this can be reduced through deductions and offsets, and earnings in the pension phase are generally tax-free.
What are the costs associated with running an SMSF?
Costs can include investment fees, accounting and auditing fees, legal fees, and administrative expenses. These costs vary depending on the size and complexity of the fund.
Where do I find additional information about SMSFs?
There’s plenty of resources available online regarding the usage and set up of your SMSF – however, it’s vital to make sure you visit reputable resources with industry certified credentials. A few of our favourites include:
1. Australian Taxation Office (ATO) – SMSF Section
2. SMSF Association
3. MoneySmart (Self-managed super fund (SMSF) section)
4. SuperGuide
5. AustralianSuper’s SMSF Hub
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