Getting started with your SMSF

Are you ready to set up your self-managed superannuation fund? This guide will take you through the most important steps.

A self-managed superannuation (SMSF) gives you control over your retirement savings investments, along with greater flexibility and choice. But with that power comes responsibility.

It’s a significant decision which will affect your future financial security, so before you get started, you should discuss your options with SMSF professionals – including a financial adviser, lawyer, and/or accountant. They can help you make sure you set up your SMSF correctly, and have confidence you’ll meet compliance requirements.

Here are some steps you’ll need to consider.

Step 1. Choose the SMSF members and trustee structure

A super fund is a special type of trust in which a person or company holds assets in trust for the provision of retirement benefits.

Will your fund have an individual trustee structure or a corporate trustee structure? It’s an important decision, as it will impact your compliance obligations and how you manage fund assets.

All SMSFs can have one to six members. An individual trustee structure requires each member to be a trustee, and a corporate trustee requires each member to be a director – however, if you have only one member in an individual trustee structure, you still need at least two individual trustees.

There are additional ASIC reporting obligations with a corporate structure – but it does make it easier to administer asset ownership and deal with changes if a member leaves or dies and there is a change of director. 

Once you’ve made this decision, make sure the people you wish to be appointed as trustees or directors are eligible for that role and understand their obligations.

Learn more about the legal obligations of SMSF structures.

Step 2. Organise and sign your documents

Now you can arrange to organise and sign the trust deed and set up the governing rules of your SMSF. Trustees or directors of corporate trustees need to consent in writing to their appointment and decide to accept the members of the fund. This may mean documenting declarations and trustee minutes and preparing a product disclosure statement (if required) with the help of a legal adviser.

As soon as you sign the trust deed, your SMSF may need an SMSF bank account to hold a nominal amount until you rollover or transfer super assets. See Step 4.

Step 3. Register your SMSF with the ATO

You must register your SMSF with the ATO by applying for an Australian Business Number (ABN), as the ATO is the regulator of your fund. If it meets all regulatory requirements, your fund will then be entitled to concessional taxation treatment as a complying superannuation fund. You can also register for GST.

Step 4. Set up your SMSF bank account

Your SMSF bank account is the lifeblood of your fund. It’s where you accept member contributions and transfer your previous super balance, where your investment income (such as dividends) is received and where you pay expenses such as tax or insurance premiums.

“Choosing the right bank account is critical,” says Kris Kitto of Grow SMSF. As an SMSF administrator and accountant, he knows the difference it can make to reporting, auditing, security and visibility.

“It needs to make life easier for the trustees and their advisers,” he says. “That means a fast online setup and good app functionality with speedy transfers.”

He also suggests looking at security measures, including multi-factor authentication and the ability to authorise adviser-initiated payments such as tax bills or a property deposit.

“When you’re dealing with such large sums of money, having another set of eyes on a transaction is essential,” says Kitto.

Olivia McArdle, Head of Payments and Deposits with Macquarie Bank, says Macquarie’s Cash Management Account (CMA) has been a popular choice for SMSFs for many decades.

“If we have all the right information, you can open a CMA for an SMSF in the same day, which is important when you’re coordinating trust deeds and ATO registration,” she says. “Macquarie’s CMA offers real-time banking and transfers and a competitive rate, as well as the opportunity to attach an Accelerator account for a higher on-call cash rate.”

She says advisers and accountants also appreciate the ease of integration and reporting, as well as third-party authority.

“With an important investment like your super, you want to be confident your SMSF cash hub is secure, competitive and makes managing your fund as easy as possible,” she says.

“With an important investment like your super, you want to be confident your SMSF cash hub is secure, competitive and makes managing your fund as easy as possible."

Olivia McArdle

Macquarie Bank Head of Payments and Deposits


Step 5. Transfer your super and set up your fund to receive contributions

Now you can rollover part or all of the balance from your other super funds. You will need an electronic service address (ESA) to receive rollovers and accept employer contributions – your SMSF administrator can provide you with this, or you can use a SuperStream provider. More information is available on the ATO’s website.

Seek advice before closing your previous super fund(s), as it may make sense to keep a small balance to preserve insurance benefits.

You may also want to set up new life, total and permanent disability (TPD) and income protection insurance policies within your SMSF so you can make premium payments from within super. A personal insurance specialist can help you find the right policy for your needs.

Record the TFN for each member, so your SMSF can receive member contributions and avoid paying additional tax on employer contributions. If the fund offers binding death benefit nominations, ensure each member makes a death benefit nomination.

Step 6. Develop and implement your SMSF investment strategy

Legally, you must prepare and follow an investment strategy that sets out your fund’s objectives and the types of investments your fund can make. This provides a decision-making framework for fund trustees. A financial adviser can help you with this, or you can choose to be a self-directed investor.

Think about the personal circumstances of all fund members. For example, if one member is closer to retirement, you may wish to apportion some investments into a lower-risk strategy.

It’s important to consider:

  • diversification – the ATO may check for asset concentration risk, especially if your fund borrows to acquire the asset
  • risks and likely returns
  • liquidity, including expected cash flow – for example, keeping enough cash on hand to meet fund expenses
  • whether the fund should hold insurance for one or more of the fund members.

If your SMSF governing rules allow, your SMSF may invest in any of the following investments:

  • shares
  • listed or unlisted property trusts
  • fixed interest securities
  • government and/or corporate bonds
  • managed funds
  • commercial or residential investment property
  • cash
  • art and other collectibles
  • precious metals
  • derivatives
  • cryptocurrencies
  • forex and/or commodities trading.

Keep a record of all decisions, including why a particular asset was chosen and whether all trustees agreed.

Learn more about ATO recommendations and requirements for your SMSF investment strategy.

Step 7. Review and monitor your investments

Markets move up and down, and your members’ needs and risk appetite will change. So, it’s important to review your investment strategy regularly – at least once a year. The ideal frequency will depend on the nature of your investment strategy.

Ready to set up your SMSF? Explore your SMSF bank account options with Macquarie.

Discover the Macquarie Cash Management Account

Learn more about Macquarie's SMSF bank account, the Macquarie Cash Management Account (CMA).

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Additional information

This information has been prepared by Macquarie Bank Limited AFSL and Australian Credit Licence 237502 and does not take into account your objectives, financial situation or needs. Before making any financial investment decision or a decision about whether to acquire a product mentioned on this page, a person should obtain and review the terms and conditions and/or relevant offer documents relating to that product and also seek independent financial, legal and taxation advice. Target Market Determinations are available at our Design and Distribution Hub.

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The information in this article was finalised on 25 August 2023.