Minimum balance on a SMSF?
- Thread starter Harriet
- Start date
I'm no expert but generally I was advised to have $100k, though there is no legal minimum that I am aware of. Its just that anything less than that makes it unviable. Why? Can't answer that. Maybe the fees vs returns as they need to be audited annually but then you loose fees out of 'normal' super funds anyway.
We have found ours to be really great. It is another investment vehicle that fits well into our portfolio.
We have found ours to be really great. It is another investment vehicle that fits well into our portfolio.
HI there Harriet
don't think there is a legal minimum but the minimum amount is based upon the ongoing costs of having a SMSF.
We started with $60K - used Taxpayers Australia to help us get the documentation up and running and used our accountant who is pretty with it to keep us up to date with the ongoing requirements.
The main costs each year are the audit requirements and any subscriptions, planning costs etc to review the products being bought for the fund whether it be shares, property, antiques, paintings, other collectables etc
thanks
don't think there is a legal minimum but the minimum amount is based upon the ongoing costs of having a SMSF.
We started with $60K - used Taxpayers Australia to help us get the documentation up and running and used our accountant who is pretty with it to keep us up to date with the ongoing requirements.
The main costs each year are the audit requirements and any subscriptions, planning costs etc to review the products being bought for the fund whether it be shares, property, antiques, paintings, other collectables etc
thanks
- No minimum amount required
- Advisers recommend $100,000k+
- However, if you were to Salary sacrifice and were not placing the 9% SGC then may be a better option to start with lower amount
- To calculate if is fesible for you - work out how much it is costing you now in fees etc and work out how much it would cost for your SMSF
- Advisers recommend $100,000k+
- However, if you were to Salary sacrifice and were not placing the 9% SGC then may be a better option to start with lower amount
- To calculate if is fesible for you - work out how much it is costing you now in fees etc and work out how much it would cost for your SMSF
I will have about $250K to start the fund.
My question arose from the fact that we are thinking of buying outright our first IP within the Fund. This would leave a relatively small amount in the Fund until it builds up again - and I just wondered if there was some kind of legal minimum we'd need to leave in the Fund.
Obviously, we would leave enough for accounting and auditing and other incidentals.
Harriet
My question arose from the fact that we are thinking of buying outright our first IP within the Fund. This would leave a relatively small amount in the Fund until it builds up again - and I just wondered if there was some kind of legal minimum we'd need to leave in the Fund.
Obviously, we would leave enough for accounting and auditing and other incidentals.
Harriet
No, no minimum amount legally required.
You can start the fund with $1000 but you would be crazy to do so.
Most of our clients have a minimum of $75,000 because when you work out the fees for maintaining the fund you want to esnure that they dont erode the balance away too quickly and make the investment unviable.
Other than the additional Accounting work you will that the compliance costs to manage a fund of $100K are similar to one of $1M.
Most of our clients have a minimum of $75,000 because when you work out the fees for maintaining the fund you want to esnure that they dont erode the balance away too quickly and make the investment unviable.
Other than the additional Accounting work you will that the compliance costs to manage a fund of $100K are similar to one of $1M.
There is no legal minimum to have in the account. The ATO is more interested in the legality of the transactions (ie that these are compliant with the SMSF rules) rather than the success of the investments. You do need to have the money to be able to pay those audit and accounting fees though. Every 3 or maybe it is 5 years, the value of the property will need to be assessed in writing by a Registered Valuation Agent as the SMSF needs to determine the value of the investments in it by COB on June 30.
One thing to be wary of is that as you approach retirement age, the assets you hold can be easily liquidated so that the retiring person can receive their entitlements. Shares are easy to liquidate, property less so.
One thing to be wary of is that as you approach retirement age, the assets you hold can be easily liquidated so that the retiring person can receive their entitlements. Shares are easy to liquidate, property less so.
http://www.ato.gov.au/superfunds/content.asp?doc=/content/00100435.htm&page=13&H13
the total asset ranges of smsf over a four year period. As you can see there are many smsfs with not much assets, and this is before the financial crisis.
the total asset ranges of smsf over a four year period. As you can see there are many smsfs with not much assets, and this is before the financial crisis.
