Costs / Fees


So one of the most asked questions is what are the costs involved in starting and running your own Self Managed Superannuation Fund. The easiest way to understand this is to break it in four separate areas, the initial advice costs, the establishment costs, the ongoing administration and ongoing advice costs.

SMSF Costs

What am I up for?

INITIAL ADVICE

The initial advice fee will depend on if you are seeking advice specifically on setting up an SMSF or a full plan looking at your Superannuation, Insurance, Debt and other investments. You should meet with a Financial Planner, preferably a SMSF Specialist Advisor™, to ensure you are dealing with an experienced professional, and ask for a quote before agreeing to any work. Depending on the complexity of your situation you can expect to pay between $1870 and $8,800(for really complex cases). The average seems to be about $2400.

ESTABLISHMENT COSTS

The upfront or establishment costs will be determined on whether you have an individual trustee or a corporate trustee but we always recommend a sole purpose corporate trustee (See here for reasons why). If you use a Corporate Trustee, it should be no more than $1,000 to 1,500 to setup inclusive of the $469 ASIC Incorporation Fee. These are just the pure basic costs of the legal documentation required to establish the fund and register it as a Complying Super Fund and apply for an ABN and TFN.

ESTABLISHMENT COSTS FOR SMSF BORROWING (LRBA)

To borrow for property via an SMSF you will need a Bare Trust and usually a Trustee company, see here for more details.  Basically the BAre Trust holds the property whilst the loan is in place. The upfront or establishment costs will be determined on whether you have an individual trustee or a corporate trustee but we always recommend a corporate trustee. If you use a Corporate Trustee, it should be no more than $1,400 to 2,000 to setup inclusive of the $469 ASIC Incorporation Fee. You do not apply for an ABN and TFN for Bare Trust/Trustee

ONGOING ADMIN

The ongoing administration 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 2 lots of administration 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.

The total of fees should not exceed $2,000 per annum if you have a simple fund and online providers are bringing the costs down dramatically with a $79 – $189 per month fee covering Admin and Audit. If you have a more complex Fund, you can expect to pay around $2500 – $5000 per annum but these costs are being driven lower with the use of data feeds and as I mentioned competition from online administrators so shop around. Be careful about choosing your administrator as often you get what you pay for but some of the better providers are becoming lower cost as well.

Now these administration and audit costs are just the base costs of what you need to run your fund and keep it compliant. 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.

ONGOING STRATEGY ADVICE

If you need ongoing advice on strategy and/or investments from an advisor or in-depth/specific tax advice from an accountant then you will also have to pay for their professional services. The great thing about a self managed superannuation fund however is that you control the cheque book, so you can decide if you are getting value for money.

It is quite easy to see the fee you are paying each service provider and you have the choice to shop around and seek alternatives annually. Don’t be afraid to switch as it is often a case of just one letter of instruction and your files can be moved to a new administrator or advisor behind the scenes.

As The SMSF Coach and our parent firm, Verante Financial Planning, we specialise in the strategy, structure and education with investments being a byproduct after the other areas have been addressed. Our SMSF service operates on a Fee for Service basis for new clients so you know your annual costs upfront and can walk away at any time if not satisfied.

We don’t do the administration or audit but can offer a range of solutions with local or online providers to suit your needs. We are more than happy to work with your existing accountant and often find that relationship grows even stronger when our education sessions give people the confidence to use their accountant’s expertise to their full potential.

Sample Annual Fees:
SMSF Coach Annual Minimum Retainer (Advice Only*) $2,640 – $28,600
Online Accounting Admin & Audit $960 – $1990 (Basic service – no tax , accounting or structure advice)
Annual ASIC Corporate Fee $47
ATO Supervisory Levy $259 ($518 for new funds in 2016/17 as pay 2 years upfront)
Total: Between $3,600 per year to $4,500 for basic fund (suit 90% of trustee)

*Advice revolves around structure and strategy and making the most of the system and your circumstances and would entail matters like:

• Salary Sacrifice
• Super Splitting, Spouse Contributions and Co-contributions
• Gearing
• Recontribution Strategies
• Transition to Retirement
• Insurance via Super and leaving cover in other funds
• Binding Death Nominations
• Reversionary Pensions

For separate investment portfolio design and maintenance we offer a fee for service quote for clients starting at $990 per annum.

Why not keep updated by putting an email address in on the left hand column and pressing the “Sign me up!” button.

If you would like to discuss your options without any obligation to proceed then you can contact Liam or Michael at our Castle Hill or Windsor offices or we are happy to use Skype, phone or email as suits your needs. Alternative use the “Schedule Now” button to set up some times that suit you.

For a copy of our Financial Services Guide please visit our website http://www.verante.com.au

Bye for now and hopefully talk to you soon!

Liam Shorte B.Bus SSA™ AFP

verante nice logo

Corporate Authorised Representative of Magnitude Group Pty Ltd ABN 54 086 266 202, AFSL 221557

This information has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation and needs. This website provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such.

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3 Comments

  1. david vinegrad

     /  April 17, 2017

    Thanks Liam,

    That sounds good to us,

    We will make an online booking with you and look forward to chatting with you soon!

    Kind regards.

    Liked by 1 person

    Reply
  2. david vinegrad

     /  April 17, 2017

    Hi Liam,

    What is the fee for a 30 minute Skype chat?

    We are based in Melbourne and like the idea of using Skype.

    Kind regards.

    Like

    Reply
    • Hi David, the initial meeting is at our cost and is just to see if we can help you and identify strategies that may be appropriate. Also for you to gauge if You feel we are the right advisors for you. After that meeting if we think we can help we will provide a Letter of Engagement outlining areas to advise on and fee involved.

      We do visit Melbourne client’s 2-3 times per year once on board.

      Cheers

      Liam

      Like

      Reply

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