13.08.2013

What are the costs, both upfront and ongoing?

So what are the costs involved in having your own Self-Managed Superannuation Fund. The easiest way to understand this is to break it in two separate areas, the upfront cost and the ongoing cost.

The upfront cost will be determined on whether you have an individual trustee or a corporate trustee. If you are an individual trustee it shouldn’t cost you more than $800 to $1,000 to setup. If you’re a Corporate Trustee, it should be no more than $2,000 to setup.

The ongoing cost will be determined by the complexity and size of your fund and whether it’s Accumulation or Pension mode. Typically however you will be paying three lots of fees on an ongoing basis. You will be paying your Account Keeping fee, to get your tax return. You will be paying the Audit fee, because you are now the trustee so you need to get an audit every single year and you will be paying the ASIC fee, if you have a corporate trustee.

The total of fees should not exceed $2,000 per annum if you have a simple fund. If you have a more complex Fund, you can expect to pay around $2500 - $3000 per annum.

Now these costs are just the base costs of what you need to run your fund. There may be additional costs that may be applicable to you. For example, if you buy an investment property and you have a bare trust there will be one extra layer of cost associated with this.

If you employ an advisor and a specific accountant then you will also have to pay for their professional services. The great thing about a superannuation fund however is that it is quite easy to split the fee as to what you are paying your adviser and what you need to keep the fund compliant and running every single year.

Before you start, it is really important that you understand and you get your accountant and advisor to explain to you what your cost liability will be upfront and what it will be on an ongoing basis.