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5 steps to set up an SMSF

Olivia Long
Friday, August 23, 2013

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by Olivia Long

So you’ve decided to establish an SMSF.

Prior to establishing your SMSF, I recommend you consider whether you would prefer to work with an SMSF Administrator or your Accountant.

Most Accountants offer your traditional year-end style tax service where you are very much reliant on tracking contribution and pension figures manually yourself during the financial year. A good SMSF Administrator will provide you with online access to reports that give you this information daily (making it far easier for you to monitor).

Do your research because there are a number of SMSF Administrators providing free fund establishment. The process is highly systematised and it should be a quick and simple process.

Step 1 – Determine your trustee structure

Keep in mind each member in the fund must also be a trustee. You can choose from an individual trustee structure or a corporate trustee structure. If you select a corporate trustee, incorporate the company prior to establishing your SMSF.

Step 2 – Your SMSF Paperwork

Your establishment kit should contain:

  1. Your SMSF trust deed
  2. Application for Membership including the provision of tax file numbers and personal details for each member
  3. Minutes for the initial meeting held by the trustees
  4. The election by the fund to be a regulated fund by the ATO and the ABN and TFN application form
  5. Paperwork to establish a bank account for the fund noting that the bank account will need to be in the name of the trustees ATF the super fund
  6. An Investment Strategy for the fund
  7. Nomination of Beneficiary forms to ensure your instructions for the balance of your members benefits are noted
  8. Trustee declarations


Step 3 – Rollovers and Contributions

Once you obtain your new SMSF ABN, contact your existing superannuation provider and request rollover forms. Complete these forms to facilitate the transfer of your superannuation money from your existing provider to your new SMSF bank account.

Alternatively, if you are ready to make in-specie contributions of assets and/or cash, you’re ready to go.

Step 4 – Investment Strategy

Have you finalised your fund’s investment strategy? Important items to consider when formulating your strategy are:

  • The overall investment objective of the fund
  • Desired rate of return
  • Liquidity
  • Risk profile of each member
  • Risk profile of the fund
  • Diversity of investments and asset classes
  • Anticipated time of each member to retirement
  • Insurance needs of each member


Step 5 – Implementation of strategy

Now that your fund is established and you’ve considered your investment strategy, it’s time to start investing.

The establishment process can take you up to 30 days as the ATO take anywhere from 7 – 28 days to provide the SMSF’s ABN number. One helpful hint – review the insurance cover you have with your existing super fund provider before rolling all of your super monies into your new SMSF. An SMSF can hold an insurance policy on your behalf but you most likely won’t be able to take the policy with you from your previous provider. You will need to establish a new policy. You don’t want to be stuck with no insurance cover!

Published: Friday, August 23, 2013


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