How much does SMSF Australia charge for annual SMSF accounting?

SMSF Australia offers three fixed-fee annual packages: Basic Fund at $1,300+GST (listed shares, managed funds, ETFs, term deposits), Complex Fund at $1,600+GST (adds direct property up to 2, cryptocurrency, precious metals), and Very Complex Fund from $2,000+GST (unlisted assets, private loans, derivatives, NFTs, 3+ properties). All packages include the independent SMSF audit at no additional cost.

Is the SMSF audit included in the annual fee?

Yes. The independent SMSF audit is included in all three annual fee packages — Basic, Complex, and Very Complex. It is not charged as a separate add-on.

Can SMSF Australia service my fund if I am not in the same state?

Yes. SMSF Australia operates nationally across all Australian states and territories. All client meetings and services are conducted via Zoom — there is no requirement to be near a physical office.

How much does it cost to set up an SMSF with SMSF Australia?

The SMSF setup fee is $2,000+GST, which covers corporate trustee establishment (ASIC fee $636), SMSF trust deed ($400), Class Super first-year licence ($250), ABN and TFN applications, investment strategy preparation, and rollover coordination.

Does SMSF Australia provide financial advice?

No. SMSF Australia does not provide financial planning or investment advice. Services are limited to SMSF accounting, tax, audit, compliance, and legal matters.

Can my SMSF use a Margin Loan?

Can my SMSF use a Margin Loan An SMSF is generally prohibited from using a margin loan as each drawdown is a borrowing and it also creates a charge over fund assets. Borrowing is prohibited under s67 of SIS and r13.14 prohibits putting a charge over fund assets.

A SMSF is allowed to borrow money under limited circumstances being:

to pay a beneficiary as required by law or by the fund’s governing rules i.e. pension payment, death benefit or make a contributions surcharge payment and the payments are not more than 10% of the value of the fund’s assets and the borrowing does not exceed 90 days and the payment could not be made without the borrowing
to settle certain securities and the borrowings were not originally required to settle the securities and must not exceed 10% of the value of the fund’s assets and the loan must not exceed seven days
a limited recourse borrowing arrangement (LRBA) via a Bare Trust

Otherwise, an SMSF is prohibited from borrowing.

What is a borrowing?

In accordance with the ATO’s SMSFR 2009/2 a borrowing is an arrangement that exhibits two necessary characteristics:

a temporary transfer of an amount of money from one entity (the lender) to another (the borrower); and
an obligation or an intention on the part of the borrower to repay that amount to the lender (which may be satisfied by the provision of an asset)

The ATO consider:

a loan of money
a margin lending account once drawn upon
a bank overdraft

as being examples of borrowings.

What is a margin loan?

A typical margin loan includes the following characteristics:

a line of credit used to invest into shares, ETFs and managed funds
interest is usually paid daily on the settled balance of the loan
existing equities can be used as the deposit
the loan is used to invest into other equities
the combined existing equities and new equities acquired from borrowed funds become the security for the margin loan
potential margin calls if the market goes down and the value of the equities fall below a certain level which is set at the beginning of the loan

Margin lending is a form of borrowing which is prohibited under SISA as it does not come under any exception.

ATO example from SMSFR 2009/2

John and Kerry are trustees and members of an SMSF. As part of the SMSF’s investment strategy the trustees maintain a margin lending account. The margin lending account has a cash and a loan component which are used in combination for the acquisition of shares. As part of the arrangement the trustees are able to drawdown additional amounts to finance the acquisition of additional shares.

Each drawdown under the account involves a temporary transfer of money to the SMSF with an obligation to repay. Each additional amount drawn from the account gives rise to a further borrowing. Accordingly, the SMSF trustees contravene paragraph 67(1)(a) each time they draw down the margin lending account unless one of the exceptions apply.

When a margin account is not a borrowing?

A Contract for difference (CFD) is a speculative contract enabling the SMSF investor to profit from the price movement in financial assets such as share prices, share price indices, commodity prices, futures contracts and currencies. The SMSF never physically owns the underlying asset. They are highly risky and volatile but provide higher leverage than most assets. An SMSF is able to put up a small margin deposit to hold a trading position which remains in place until closed.

The ATO recognises that the requirement to pay a deposit to meet margin calls in relation to contract for differences (CFDs) is not a borrowing. The deposit is made to the CFD provider and is not an asset of the SMSF who does not have any beneficial interest in the account. The contract in relation to CFDs are to make payments if and when required and are not repayments made with the intention of repaying a loan. A broker can require further margin calls to cover losses on open positions.

However, a SMSF entering into a separate contract to use other fund assets as security for margin obligations will breach r13.14 as the SMSF is prohibited from charging fund assets ATO ID 2007/57.

How can my SMSF leverage Shares?

Leveraging shares is available to an SMSF using instalment warrants or an LRBA.

What are instalment warrants?

Instalment warrants in an SMSF are a LRBA. If the SMSF defaults, the lender’s recourse is limited to the equities used as security, not other fund or trustee assets. Instalment warrants are typically offered by lenders for investing in ASX-listed shares, ETFs, or listed managed funds. Section 67A allows borrowing if a single acquirable asset is purchased. A single parcel of identical shares in one company with equal market value is considered a single acquirable asset.

The general characteristics of an instalment warrant include:

acquiring a parcel of ASX listed equities in the one company at market price funded partly by SMSF cash – typically 40 to 60% and the remainder via borrowings
the cash component is known as the First Instalment
the warrant provider gives the SMSF trustee a LRBA which is known as the Final Instalment
the Instalment Warrants can be sold on the market at any time prior to the Final Instalment
during the course of the arrangement the SMSF receives the dividends and franking credits or can elect to offset the Final Instalment and an SMSF is subject to tax on the dividends
interest and borrowing expenses are included in the Final Instalment and part of the interest and borrowing expenses are tax deductible to the SMSF
the SMSF trustee pays out the Final Instalment before the maturity date and the ownership of the shares is transferred from the custodian to the SMSF trustee or sold to the issuer and the SMSF trustee receives the market value of the equities less the Final Instalment and costs

Limited Recourse Borrowing Arrangement (LRBA)

An LRBA has the following characteristics:

the borrowed money can only be used to acquire a “single acquirable asset” which can include a parcel of shares in the same company for the same value
the asset must be one permitted under SISA
the asset must be legally held on trust being a bare or holding trust
the lender only has recourse to the single acquirable asset and not to the fund’s assets or the trustee’s personal assets in case of the borrower’s default