What’s involved in setting up a Self Managed Super Fund?

As a small business owner, what do you need to know before you set up and run a Self Managed Super Fund?

The details

What is a Self Managed Super Fund (SMSF) and how do you go about setting one up?

The general consensus is that there are less fees and you have greater control on how your money is invested and so by taking control of your Superannuation YOU can make more money and retire on a larger amount. It’s also a tempting prospect for small business owners who are keen to utilise their own bookkeeping skills and save on those dreaded admin fees.

However there is a different set of fees and regulations involved which are very different to running a business. And as with everything which is regulated for the benefit of society as a whole, you need to make sure you’ve got your ducks all lined up in a row and do your homework BEFORE you dive down that rabbit hole.

While your merchant service provider shouldn’t charge any set-up fees, they will charge transaction fees. These range from 2-4% of the invoice for debit or credit cards, and under $2 a transaction for direct debit. These fees are an added expense, so they need to be included in your profit calculation – smart accounting software will do this automatically. Because credit and debit fees can add up, many businesses don’t offer online payment for invoices over a certain amount.

What do you need to consider if you are a small business owner thinking about setting up an SMSF?

In the following Small Biz Matters podcast, Dana Fleming, the ATO’s Assistant Commissioner talks about what’s involved in setting up and running a Self Managed Super Fund.

Listen to the Small Biz Podcast here