Understanding Outsourcing SMSF Fees and Expenses

Understanding the average SMSF costs and fees is fundamental for trustees who want to manage their retirement savings efficiently. 

The true picture of outsourcing SMSF administration costs goes beyond initial setup expenses, it includes ongoing accounting, audit, and compliance obligations that directly impact overall fund performance.

For guidance on how outsourcing can fit into your broader practice, explore accounting outsourcing services. Recent ATO data now offers Australians a clearer understanding of the true costs involved in running a Self-Managed Super Fund.

The updated figures provide a more detailed breakdown of SMSF administration, accounting, and audit fees, offering valuable insight for those evaluating whether to manage in-house or outsource key functions. 

In essence, this data helps answer a vital question: How much does it really cost to establish and maintain a self-managed super fund?

What Are the Average SMSF Costs and Fees Per Annum?

Understanding the annual running costs of a Self-Managed Super Fund is essential when assessing long-term financial viability. ATO data shows the average annual SMSF running cost is around $3,934.

Understanding these self-managed super fund costs is essential for trustees to assess whether their SMSF remains financially sustainable over time.

This figure represents the median operating expenses incurred by trustees, covering key components such as SMSF auditor fees, SMSF accounting and administration costs, the ATO Supervisory Levy, and other ongoing deductions associated with managing an SMSF each year.

Median and average fees and costs per annum

• Auditor fee: A$550 (median)
• Management and administration costs, covering accounting, compliance, and daily operations, had a median of A$2,808.
• Supervisory levy: A$259 (median)
• Other deductible operating expenses: A$317 (median)

The total average cost (not median) for the same period was significantly higher, about A$7,953, largely because the “average” includes large funds with more complex operations. 

The cost figures shown above do not cover all SMSF expenses. The following common costs are excluded from the calculation:

• Insurance premiums (e.g., life, TPD, income protection)
• Investment-related fees (investment administration and management costs)
• Interest expenses related to Limited Recourse Borrowing Arrangements (LRBAs)

Although the “Management and Admin Expenses” category largely reflects SMSF accounting fees and administration costs, there is a possibility that financial advice fees and investment administration charges are included within this amount, which may slightly inflate the reported figure.

The ATO’s annual SMSF statistics are released with an approximate two-year delay, as the data is compiled only after a significant majority of SMSFs have lodged their annual returns.

These figures are drawn from 470,415 SMSFs, out of a total population of 581,853 as at 30 June 2018, indicating that not all funds were captured in the final dataset.

Why More Trustees Are Reconsidering SMSF Administration Costs Through Outsourcing

Managing an SMSF is now more demanding, with stricter compliance, greater reporting requirements, and higher accountant fees. This has led many trustees to rethink the traditional in-house model and consider outsourcing for better value and efficiency.

Key Reasons Trustees Are Turning to Outsourcing

• Escalating compliance and reporting workload
  Stricter ATO requirements, more frequent reviews, and increased documentation have made SMSF administration more time-intensive and complex for trustees.
• Rising annual SMSF fees charged by accountants
  With rising labour and time demands, many firms have increased their SMSF accounting and administration fees, prompting trustees to seek more cost-effective alternatives. This trend has also motivated many firms to explore outsourcing for accounting firms to manage capacity.
• Cost savings and better turnaround times through outsourcing
  Outsourcing SMSF administration offers access to skilled specialists at a lower cost, faster processing, and improved accuracy, helping reduce ongoing SMSF management fees.
• Flexible outsourcing models to suit different needs
  Trustees now have multiple outsourcing structures to choose from, including:
  • Local outsourcing (Australia-based)
  • Hybrid outsourcing (onshore client service + offshore processing)
  • Offshore SMSF expenses model – the most cost-effective approach for lowering       SMSF administration and accounting fees

Outsourcing has evolved from a cost-saving tactic into a strategic approach that enhances compliance, cuts ongoing expenses, and simplifies SMSF administration, providing trustees with a more balanced and sustainable support model.

Outsourcing SMSF Administration Costs: What’s Included?

Outsourcing SMSF administration shifts costs from multiple separate charges to a more bundled and predictable annual fee. Most outsourcing SMSF fees include core accounting, compliance, and admin services, reducing time, effort, and surprise costs for trustees.

Typically Included in Outsourced SMSF Fees

• Annual accounts, tax return & ATO lodgements
• Bookkeeping and transaction processing
• Compliance monitoring and member reporting
• Online SMSF accounting fees and software access
• Access to outsourced SMSF audit fees through bundled or partnered auditor arrangements

Often Not Included

• Financial/investment advice
• Legal updates (e.g., deed changes)
• Actuarial certificates

SMSF Cost Comparison: In-House vs Outsourced

Outsourcing has become an attractive solution for trustees seeking efficiency without compromising compliance. Below is an indicative comparison of SMSF running costs based on the delivery model.