Note: This guide reflects the latest SMSF compliance rules for 2024–25.
1) Keep Personal and Fund Assets Separate
Mixing SMSF assets with personal finances breaches the SIS Act. The ATO treats your SMSF as its own legal entity. Once you blur the lines, you risk penalties or disqualification.
| Compliant | Non-Compliant |
|---|---|
| Dedicated SMSF bank account | Paying personal bills from SMSF account |
| Assets titled in SMSF name | Shares in trustee’s personal name |
| Arm’s-length lease to unrelated tenant | Family using SMSF-owned holiday home |
2) Stick to Your Investment Strategy
The ATO requires a written investment strategy considering diversification, risk, liquidity, members’ circumstances and insurance needs. Review annually and make sure your portfolio matches.
| Good Practice | Risky Practice |
|---|---|
| Diversified investments | 100% in one speculative asset |
| Annual review documented | Strategy written once and forgotten |
| Holdings align with strategy | Assets outside documented plan |
3) Meet All Lodgement Deadlines
Late lodgements risk penalties and can jeopardise your SMSF’s complying status. Appoint an auditor at least 45 days before the SAR is due.
| Requirement | Deadline |
|---|---|
| Annual Return (SAR) | 31 Oct if self-lodged first year; 28 Feb if first year on agent’s program; up to 15 May for ongoing tax-agent clients (confirm with your agent). |
| Audit completion | Must be done before lodging SAR. |
4) Stay Within Contribution Caps
Exceeding caps triggers extra tax. Track all contributions, including employer SG.
| Type | Cap (2024–25) | Notes |
|---|---|---|
| Concessional | $30,000 | Excess taxed at marginal rate + charge |
| Non-Concessional | $120,000 | Bring-forward up to $360k/3yrs if eligible |
5) Avoid Early Access to Funds
Only withdraw when a legal condition of release is met.
| Allowed | Not Allowed |
|---|---|
| Retirement at preservation age | Paying personal debts |
| Severe financial hardship (criteria apply) | Holiday expenses |
| Terminal illness / compassionate grounds | Home renovations |
6) Keep Accurate and Complete Records
Different retention periods apply:
| Record Type | Retention |
|---|---|
| Financial records (bank statements, accounts, SAR) | 5 years |
| Trustee records (minutes, declarations, change records) | 10 years |
7) Work with an Experienced SMSF Professional
Trustees are responsible, but an expert keeps you aligned and compliant.
FAQs
What happens if I miss an SMSF deadline?
The ATO may impose penalties, remove concessional status, or restrict your fund.
Can I withdraw from my SMSF for personal use?
No, unless you meet a strict condition of release. Otherwise it’s illegal and heavily penalised.
How often should I review my investment strategy?
At least annually, and whenever members’ circumstances change.