What are the benefits of an SMSF?

There are a number of benefits of an SMSF. Being a trustee means you can choose how to invest and manage your super savings. Below we explore the main benefits to setting up an SMSF and managing your own superannuation.

Investment control

Most superannuation funds will allow you to invest into assets such as:

  • shares

  • fixed interest

  • property via managed funds (often with restrictions).

SMSFs can offer a range of additional options including: 

  • direct property (commercial or residential)

  • physical gold and other commodities

  • collectables such as artwork (subject to strict requirements)

  • Managed Portfolios.

SMSF benefits also include the flexibility of borrowing within your fund for investment purposes. Also, some small business owners may hold their business premises within their SMSF for a variety of reasons including asset-protection, succession planning and security of tenancy.

Greater investment flexibility

SMSF members also have greater flexibility on when they acquire and sell their investments and this hands-on approach can mean, for example, as market conditions change you can quickly respond by adjusting your investment portfolio.

Ability to pool your super

Another benefit to an SMSF is the ability to pool your resources with up to three other members. This increased pool may allow you to access investment opportunities that may not be available otherwise to your SMSF.

Estate planning

SMSFs offer great flexibility with your estate planning needs. If the fund’s trust deed allows it, SMSF members can make binding death benefit nominations that do not lapse, unlike many public offer superannuation funds which tend to require binding death benefit nominations to be updated every three years. In addition, SMSF members may have greater flexibility in specifying how death benefits are to be paid.

Effective tax management

In an SMSF you have greater control of your assets and investment decisions, which may allow you to better manage the tax position of the SMSF.

The current tax rate on earnings within a superannuation fund is 15%, but where the income is produced by assets wholly supporting an income stream such as a pension, there is no tax payable within the fund on that income.

This difference in tax rates means that by having control over the disposal of assets, you may be able to reduce, or potentially eliminate a capital gains tax liability.

Adding value with property

Adding to your SMSF with property can be another way to grow your super. Owning property through your SMSF typically involves the fund acquiring a residential or commercial rental property which is leased to unrelated tenants. Fund members or relatives can’t rent a residential property from an SMSF because of the in-house assets test.  

Always consider the risks

There are strict laws and regulations that govern SMSFs. As a trustee of your own super fund you’re held responsible for your investments and complying with superannuation and taxation laws. Make sure you’re aware of the risks to consider before setting up an SMSF.

Next: 5 steps to setting up a self managed superannuation fund (SMSF)

Once you’ve decided an SMSF is right for you, it’s important to understand the steps involved in setting up an SMSF. Learn more with BT.

You may also be interested in:

Self managed super funds can offer trustees more control over the taxation of their superannuation, but like all aspects of SMSFs, there are rules that apply. Learn more with BT.
An SMSF allows you to manage your own superannuation investments for your retirement. It’s important to understand the basics before getting started. Learn more with BT.
As with other aspects of self managed super funds there are rules around who can be a Trustee or Director of the corporate Trustee of your SMSF. This article explains some of those Trustee rules.

Learn about managing your own super, frequently asked questions and more. 

Learn about SMSF

Find out how BT can help you set up, invest and manage your SMSF – all in one place.

Find out more


The information in this document has been prepared by BT Portfolio Services Ltd ABN 73 095 055 208 AFSL 233715 (BTPS) and is current as at 2 December 2016. The information provided is general in nature and does not take into account your personal needs, objectives or circumstances and therefore, before acting on it, you should consider whether it is appropriate for you.

BTPS operates BT Panorama Investments (the investor directed portfolio service operated by BTPS). BT Funds Management Limited ABN 63 002 916 458 AFSL 233724 (BTFM) is the responsible entity and issuer of interests in BT Cash and Westpac Financial Services Ltd ABN 20 000 241 127 AFSL 233716 is the responsible entity and issuer of interests in BT Managed Portfolios. An Investor Guide is available for BT Panorama Investments and a PDS is available for BT Cash and BT Managed Portfolios (the Panorama products). These disclosure documents can be obtained from BTPS by visiting www.bt.com.au/smsf or calling 1300 554 267. A person should obtain and consider the disclosure documents before deciding whether to acquire, continue to hold or dispose of interests in the Panorama products.

In addition, BTPS is the provider of the Panorama SMSF Establishment Service and the Panorama SMSF Administration Service. The Guide and Terms and Conditions for these services are available by visiting www.bt.com.au/smsf or calling 1300 554 267.

BTPS, BTFM and WFSL are subsidiaries of Westpac Banking Corporation ABN 33 007 457 141 (Westpac). Apart from any interest investors may have in Westpac term deposits or securities acquired through Panorama, an investment in or acquired through Panorama is not an investment in a bank or a bank deposit. Westpac and its related entities do not guarantee an investment in or acquired through Panorama Investments.