Can I set up an Interactive Broker account for my SMSF?
Yes, an SMSF is able to setup an Interactive Broker account to trade! Interactive Brokers Australia Pty Ltd (IB Australia) holds an Australian Financial Services License and provides services to Australian clients. The platform enables self-managed superannuation funds (SMSFs) to invest in securities such as listed stocks, exchange-traded funds (EFTs), options, futures, currencies, and bonds across 170 markets in 40 countries. It utilises cutting-edge technology and trading tools to enable trading from a single integrated account via desktop, web, or mobile app, with low fees.
How does Interactive Brokers align with super laws for an SMSF?
An SMSF account with IB Australia is designed to comply with Australian superannuation laws (SISA) and is available only to Australian customers.
What are some features of an SMSF account?
- Margin loan accounts are not available for SMSFs as they do not meet SISA requirements.
- An SMSF account is specific to an SMSF and is a cash account that does not permit short selling or borrowing funds.
- All SMSF accounts are classified as retail clients.
- ASX-listed shares are held custodially rather than through a CHESS Holder Identification Number, meaning the SMSF auditor cannot verify direct ownership and holdings. However, this is usually a minor audit issue, especially if there is supporting evidence of the fund’s ownership, such as statements from the administrator, and if the administrator has internal audit checks in place.
- To open an account with IB Australia, an SMSF must provide its trust deed, details of its corporate trustee (if the trustee is a company), and proof of identity for each member.
- Specialised reports are available related to the record-keeping requirements of an SMSF.
- Third-party integration is accessible through IB Australia via a generic reporting interface or HTML downloads, facilitating efficient management of large transaction volumes including with Class Super which SMSF Australia uses allowing us to process your transactions via Data Feed reducing human error and decreasing costs.
Is my SMSF required to provide Interactive Brokers with a Legal Entity Identifier (LEI)?
An LEI is a global reference code used to identify entities in complex cross-border financial transactions.
An SMSF with a corporate trustee making investments in:
- OTC derivatives
- Contracts for Differences
- margin FX
- offshore trading relationships
- counterparties with MiFID reporting obligations
may require an LEI. For more information about how derivatives in an SMSF work and how the LEI fits in with those trading activities checkout our page covering all things options and derivatives below:
Other online options
Although there are many other options available the other most popular one we see in our role is CMC Invest which offers a broad range of investments, including Australian and international listed stocks, crypto, ETFs, warrants, bonds, interest rate securities, managed funds, and listed investment companies. Complex investments, including crypto, futures trading, and derivatives, have very specific requirements that should be reviewed by the fund’s financial advisor. CMC Invest does not have any restrictions on SMSF investment accounts; therefore, before proceeding, seek advice from the fund’s financial advisor to ensure all legal and superannuation compliance obligations are met.
Furthermore, CMC Invest does not have a custodial arrangement, so the SMSF owns equities directly, which can be verified by the SMSF auditor. CMC Invest is fully integrated with Class specialist software, used for our SMSF clients, enabling efficient transaction processing.