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  • Choosing a super fund

    Most people can choose the super fund they want their employer contributions paid into, as long as it’s a complying fund. A complying fund is an Australian super fund that receives concessional tax treatment because it’s regulated under the relevant super legislation and hasn’t been issued with a notice of non-compliance.

    This page has information about:

    • eligibility to choose a fund
    • when you can’t choose your super fund
    • types of funds, including self-managed super funds.

    Eligibility to choose a fund

    You’re generally eligible to choose a super fund for your super guarantee contributions if:

    • your super is paid under a federal award or a former state award, now known as ‘notional agreement preserving state award’
    • you’re employed under another award or agreement that doesn’t require super support, or
    • you’re not employed under any award or industrial agreement (including contractors paid principally for their labour).

    If you’re eligible to choose a fund, your employer must give you a Standard choice form so you can make that choice in writing.

    You may also be able to choose how your savings are invested. Some fund investment strategies offer higher returns with higher risks, while others offer greater security for your money but with lower returns.

    You may wish to speak to an independent qualified super professional to decide your investment strategy.

    When you can’t choose your super fund

    You’re not eligible to choose the super fund you want your super guarantee contributions paid into if:

    • your super is paid under a state award or industrial agreement
    • your super is paid under certain workplace agreements, including some Australian workplace agreements (AWA)
    • you’re a federal or state public sector employee, excluded from super choice by law or regulations
    • you’re in a particular type of defined benefit fund or have already reached a certain level of benefit in that super fund.
    Further information

    For more information, refer to Choosing a super fund.

    For help comparing super funds, visit ASIC’s consumer website – MoneySmart – at moneysmart.gov.auExternal Link and use their super calculator.

    If you’re not sure what award or industrial agreement, if any, you’re covered by:

    End of further information

    Types of funds

    There are five basic types of funds. However, funds decide who can join.

    • Public sector funds: These funds are generally open to Commonwealth, state and territory government employees.
    • Corporate funds: These funds are generally only open to people working for a particular employer or corporation.
    • Industry funds: These funds are sometimes open to everyone. Otherwise, you can join if you work in a particular industry or under a particular industrial award and your employer signs up with the fund.
    • Retail funds: These funds are open to everyone. They are run by financial institutions.
    • Self-managed super funds (also called SMSFs): SMSFs work like any other super fund, but the responsibility of managing it rests solely with the trustee (you).
    Further information

    For more information about comparing super funds, visit ASIC’s consumer website – MoneySmart – at moneysmart.gov.auExternal Link and use their super calculator.

    End of further information

    Self-managed super funds

    If you set up a self-managed super fund (SMSF), the responsibility of managing it rests solely with the trustee (you).

    Establishing and operating an SMSF is a major financial decision. After all, with this type of fund you’re both a member and a trustee. This means you have control over and responsibility for your fund’s investment decisions. You also have to manage the fund’s legal responsibilities.

    SMSFs receive tax concessions like any other super fund and certain contributions made to the fund are taxed at 15%, just like any other super fund.

    There are a range of advisers and professionals who can help you. First, you should discuss your personal circumstances with a qualified professional.

    Danger

    Be very wary of promoters who approach you to set up an SMSF with the purpose of withdrawing some or all of your super to pay for things other than your retirement. These arrangements are illegal, and you could incur severe penalties and lose your super.

    End of danger
    Further information

    For more information, refer to Self-managed super funds – home.

    End of further information
    • Last modified: 02 Aug 2013QC 23220