Introduction
More Australians are turning to Self-Managed Super Funds (SMSFs) in 2025 to take control of their retirement savings. But with flexibility comes responsibility — and cost. Setting up and running an SMSF isn’t free, and the real question many ask is: is it worth the setup cost?
Understanding SMSF setup costs is essential before deciding if it’s the right choice for you. From one-off establishment fees to ongoing annual expenses, knowing the numbers can help you weigh up whether the benefits of control and flexibility justify the financial commitment.
What is an SMSF?
An SMSF is a private super fund you manage yourself. It can have up to six members, often family members or business partners. Unlike retail or industry funds, you choose where your money goes — whether that’s property, shares, managed funds, or other investments.
But with that freedom comes strict rules. Trustees are legally responsible for compliance, reporting, and ensuring the fund meets ATO SMSF requirements. That’s why understanding the cost of SMSF setup is so important — mistakes or shortcuts can be expensive.
Breakdown of SMSF Setup Costs
1. ATO SMSF Fees
The Australian Taxation Office charges a $259 supervisory levy every year, payable with your fund’s first annual return. This is mandatory for all SMSFs.
2. Professional Setup Fees
If you hire an accountant or SMSF administrator, setup fees usually range between $1,500 and $3,000. These cover:
- Preparing the trust deed
- Registering with the ATO
- Applying for an ABN and TFN
- Opening the SMSF bank account
3. Legal Costs
Your SMSF requires a trust deed. A well-drafted deed costs around $300–$700, with additional legal fees if updates are needed later.
4. Audit Fees
Every SMSF must be audited annually by an independent auditor. Costs usually sit between $300 and $600 per year.
See more: Wealth Management Solutions Offered by a Top Sydney Financial Advisor
5. Administrative Costs
Depending on your situation, you may also face:
- Actuarial certificates ($100–$300)
- Bank charges
- Investment platform fees
Hidden or Unexpected Costs to Watch Out For
Beyond the obvious fees, there are hidden costs that often surprise new trustees.
- Investment costs: Brokerage, property management fees, or stamp duty if you buy property within the SMSF.
- Insurance premiums: Life or income protection cover can be paid through your SMSF, adding to expenses.
- Compliance penalties: Breaching SMSF rules can result in ATO fines, which can run into thousands.
- Trust deed updates: Super laws change, and updating your deed may mean extra legal bills.
Factoring in these hidden charges helps avoid unexpected financial strain.
Ongoing Costs vs One-Time Setup Fees
One-time SMSF setup fees usually include professional services, legal documentation, and registration. These total around $1,500–$3,500.
Ongoing SMSF expenses are recurring and include the ATO levy, annual audits, accounting, and administration costs. On average, these add up to $2,000–$5,000 per year.
This is why SMSFs generally only make sense for larger balances — commonly recommended at $200,000 or more.
SMSF Setup Cost Comparison: DIY vs Professional Services
DIY Setup
Online services allow you to establish an SMSF for as little as $600–$1,000. While cheaper, this option carries risks. Mistakes in the trust deed, registrations, or compliance can lead to significant penalties later.
Professional Setup
Using an accountant or SMSF specialist costs $2,000–$3,000 upfront, but ensures your fund is compliant from the start. For most Australians, this peace of mind is worth the higher fee.
Is the Cost Worth It? (Benefits vs Expenses)
Benefits of an SMSF
- Investment control: Direct access to property, shares, and other asset classes.
- Flexibility: Ability to tailor investments to your financial goals.
- Estate planning: SMSFs can provide more control over succession planning.
- Pooling family assets: Up to six members can combine balances.
Downsides of an SMSF
- High ongoing costs compared to retail or industry funds.
- Time commitment: Trustees must handle compliance and administration.
- Financial risk: Small balances may see returns eroded by annual expenses.
The verdict? For super balances above $200,000, the benefits often outweigh the expenses. For smaller balances, the ongoing SMSF setup costs may not be justifiable.
How to Reduce SMSF Setup Costs Without Breaking Compliance
You can cut costs without cutting corners by:
- Comparing providers: Accountants and administrators charge different fees.
- Bundling services: Many firms offer packages covering setup, returns, and audits.
- Using digital platforms: Online SMSF platforms often reduce admin costs.
- Staying compliant: Avoid costly ATO penalties by meeting deadlines and record-keeping requirements.
FAQs About SMSF Setup Costs in 2025
1. How much does it cost to set up an SMSF?
Expect $1,500–$3,500 upfront, plus annual costs of $2,000–$5,000.
2. Do I need a large balance to make an SMSF worthwhile?
Yes, experts suggest at least $200,000.
3. Are ATO SMSF fees optional?
No, the $259 supervisory levy is compulsory each year.
4. Can I set up an SMSF myself?
Yes, DIY setup costs less, but compliance risks are high without professional support.
5. Are audits included in setup fees?
No. Audits are separate and typically cost $300–$600 annually.
Final Thoughts / Key Takeaways
An SMSF can give you control, flexibility, and unique investment opportunities, but it comes with costs and responsibilities. SMSF setup costs include both one-time fees and ongoing annual expenses that can quickly add up.
For Australians with higher super balances, the benefits often outweigh the expenses. For those with smaller balances, retail or industry funds may be more cost-effective.
💡 Thinking about starting your SMSF? Compare providers, talk to an accountant, and make sure the numbers stack up before taking the leap.
