How to set up a SMSF

Learn

The first step in considering an SMSF is to do your research. It’s important that you are aware of the benefits and costs of an SMSF as well as your responsibilities as trustee to ensure you make the right decision on whether an SMSF is right for you.

Before getting started, we would recommend reading the following topics:

1. What are SMSFs?
2. Can anyone have an SMSF?
3. What are the benefits of an SMSF?
4. Is an SMSF is right for me?

Application

In order for us to set-up your SMSF and investment account you will need to complete an application providing us the following details: 

1. A name for your fund and (if applicable) a name for the company you’re setting up to be the trustee of your fund 
2. For all members, trustees and/or directors: 

• Title 
• Legal Name (including middle names) – this must be the same as their name on official documentation such as passports, driver's licence, etc. 
• Date of birth 
• Place of birth (town and state if within Australia or Country only if outside of Australia) 
• Tax File Number
• Contact details (phone number and email address) 
• Street Address (where the person normally lives, not a PO Box or their work address) 

Establishment

Receive and sign the establishment documents 

Once Heffron have received your application, we will start setting up the fund. You will receive a fund establishment pack by post for you to review and sign.

The establishment pack includes all documents needed to establish your SMSF. It comes clearly marked explaining what you need to do and shows where you need to sign and date.  We aim to have the fund establishment pack issued in less than four business days from the time we receive all correct information from you. 

Heffron reviews executed documents and register the fund with the ATO. Once we receive the signed documents back, Heffron will conduct a final review of the executed documents to make sure they have been signed, dated and witnessed in all the correct places. 

Once we’ve done this, we’ll register the fund with the ATO on your behalf. The ATO will allocate a tax file number (TFN) and an Australian Business Number (ABN) to your fund. This may take up to 28 days and sometimes even longer. The ATO has a series of checks it runs when a new person starts or joins an SMSF.  They might call you to make sure you understand your responsibilities as a trustee.  If you owe tax or haven't lodged returns (either personally or even through a business), they might reject you altogether. Make sure you don't commit to anything for your SMSF before you've definitely been passed by the ATO.  For example, if you're setting up your SMSF to buy a property, don't sign contracts etc.   

Activation

Once Heffron has established your SMSF and you've received the fund's ABN and TFN, you can start depositing money into your fund, including rolling over your existing super balance and redirecting any employer contributions to your SMSF. 

Rollover your existing super 

When you first set up an SMSF you will likely have money in another superannuation fund that you want to transfer to your SMSF. This type of transfer is called a "rollover." 

If you're going to close your old super account and move it all to your SMSF, you can complete an ATO rollover form and send it to your old super fund. If you have more than one super fund, you will need to complete a separate form for each fund. 

If you want to leave some money in your old super account, you will need to contact your old fund and ask them for the forms to transfer only a portion of your balance to your new SMSF. 

Note that large funds often have a range of information they ask for when they are moving money into an SMSF.  In particular, they will usually ask the member to prove who they are. To get prepared for this, it can be helpful to make sure that details such as name, date of birth and address the current (public) fund has on file is exactly right - and the same as the details provided to set up the SMSF. 

Redirect employer contributions to your SMSF 

If your employer is going to contribute to your SMSF, you’ll need to give them two documents: 

• A completed Superannuation (Super) Standard Choice Form. If your fund was set-up by Heffron this was included in your Welcome Pack. If you join a new employer after your SMSF has already been established, simply complete another form and provide it to your new employer. 
• A document confirming the fund is recognised by the Australian Taxation Office as a regulated fund. You can locate and print a copy of your fund's status by searching your fund ABN or name in the Super Fund Lookup Service. 

One of the things you will need in order to complete the Superannuation (Super) Standard Choice form is your fund's "Electronic Service Address" (ESA). This is like an electronic post box for your fund. When an employer makes a super contribution for you, they are required to send a message to your fund’s electronic post box that tells you or your administrator who it is for, what sort of contribution it is, how much it is and who it is from. While your fund is being looked after by Heffron, your ESA is smsfdataflow. 

Providing Information

One of the great things about partnering with Heffron is that we collect most of the information we need directly from your investment providers without any involvement from you. We collect data feeds for investments like bank accounts and trading accounts so you don't need to collect bank statements or portfolio reports and send them to us. We may have to ask you questions from time to time but much of the administrative burden is removed from you. 

You will need to contact us if: 

• You set up a new investment – such as buying a property. We will do what we can to streamline the exchange of information between us and your other investments to minimise the effort required from you. 
• You take out insurance – we will need a copy of the policy and details of the premiums you're going to pay. 
• You want to do something like start a pension, pay out some of your super in another way, pay out super for another member who has died etc. 

Some of these things result in additional administration costs – see our document services to understand what affects the administration costs for your fund.