Skip to main content

Your SMSF Adventure: Navigating Costs with a Smile!

Embarking on the journey of setting up a Self-Managed Superannuation Fund (SMSF) is like taking a thrilling financial leap, offering you the key to unlock greater control over your retirement savings. SMSF legislation allows a a business owner to purchase a retail, commercial, or industrial property through their SMSF and rent that property back to their business. But before we set sail on this exciting adventure, let’s dive into the costs of establishing an SMSF and provide you with a friendly breakdown of what to expect.

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

Think of a Self-Managed Super Fund, or SMSF, as your own private superannuation playground! Unlike retail or industry super funds, where you’re just along for the ride, in an SMSF, you get to steer the ship. SMSF members are typically also the trustees or directors, giving you control over investments, insurance, and the rules of the super and tax game.

Can an SMSF Borrow Money?

Absolutely! SMSFs have the power to borrow money to invest in property through a Limited Recourse Borrowing Arrangement (LRBA). These loans may sound complex, but don’t worry; we’ve got the experts at WE Mortgage Solutions to assist you throughout the process of securing SMSF loans. Smooth sailing, indeed!

How Much Does It Cost to Set Up an SMSF?

Ahoy, matey! The costs of setting up an SMSF can vary based on several factors, just like the treasures you might find on a pirate’s map. Let’s break down some common expenses associated with SMSF setup.

1. SMSF Trust Deeds

Every SMSF setup needs a trust deed, the treasure map that outlines the fund’s rules and regulations. The cost for this crucial document can range from $1,450 to $4,850, depending on your fund’s structure:

  • Option 1: Individual Trustee structure – $1,450 per member
  • Option 2: Corporate Trustee structure – $2,450 (our recommended choice for SMSFs)
  • Option 3: LRBA – $1,950 (includes GST)

Remember, just like hunting for buried treasure, these figures are approximate and may vary based on your unique circumstances and service providers. So, gather your crew, conduct some research, and seek professional advice to ensure a successful SMSF setup.

2. Other Charges

As we sail through the SMSF seas, we encounter some additional costs:

  • ATO: SMSFs must pay an annual supervisory levy of $259, which remains as steady as a ship’s anchor.
  • ASIC: Corporate trustees face an annual review fee of $69, subject to yearly indexation. LRBA structures have regular ASIC company fees, currently $310 in FY24.
  • Property Valuation Fees: Every 2-3 years, SMSFs must value the properties they hold. Residential properties may undergo a desktop valuation, while commercial properties require a valuer, with costs averaging around $800-$1000.

3. SMSF Accounting and Audit Fees

Beyond the initial setup, there are ongoing costs to consider, much like the maintenance of a sturdy ship. By The Numbers offers a fixed-fee SMSF accounting service starting from $2,000. This comprehensive service covers annual financials, tax return preparation, member statements, independent audits, and access to an SMSF accountant for general guidance.

4. SMSF Investment and Strategic Advisory Fees

Many SMSF sailors choose to enlist professionals, such as financial planners, for expert guidance on their voyage. These fees can vary, typically ranging from $2,500 to $10,000, depending on the scope and depth of services required. A worthwhile investment for a smooth journey!

At By The Numbers, we’re your trusty SMSF companions, dedicated to ensuring you’re well-prepared for your adventure. Whether you’re hoisting the sails to set up an SMSF or need assistance with SMSF accounting, audits, or investment advice, we’re here to make your voyage a success. Our team stays up-to-date with the latest regulations and compliance requirements to keep your SMSF shipshape and ready for any financial storm.

So, let’s embark on this thrilling SMSF adventure together! With our friendly support, you’ll have full control over your retirement planning. Feel free to reach out for personalized guidance and support as we navigate the SMSF seas and set sail towards your financial dreams.

Smooth sailing and treasure-filled horizons await!

Contact us today to discuss your Self Managed Super Fund requirements and learn how to take control of your retirement savings.