SMSF illegal early access estimate
Self-managed super fund (SMSF) 'Illegal early access' refers to assets being removed from an SMSF early without meeting a condition of release.
Superannuation savings are important to the community. They provide funds for people’s retirement. Even small amounts of illegal early access can have a significant impact on an individual's retirement savings.
For 2022–23, we estimate SMSF illegal early access to be $252.0 million.
SMSFs estimate
An SMSF is a way of saving for retirement. Members run them for their own benefit. They make investment decisions for the fund and are responsible for complying with tax and superannuation laws.
An SMSF must be run for the sole purpose of providing retirement benefits for the members. Additionally, all decisions made by members as trustees of their fund must be in the best financial interests of the members.
In 2022–23, there were 598,564 SMSFs, with an estimated $921,212.0 million in total assets (as of May 2025).
About the estimate
The SMSF illegal early access estimate combines estimates for both non-lodging and lodging funds. It forms part of our overall tax and super performance program, and measures the difference between:
- what should be held in super, and
- what is held in super.
We calculate the estimate in a similar way to tax gap estimates. See Australian tax gaps – overview.
Comparison with previous years
The 2022–23 SMSF illegal early access (IEA) estimate of $252.0 million has increased, compared with $250.1 million in the 2021–22 estimate.
This increase may be attributable to a range of factors, including:
- economic factors
- possible changes in compliance
- ATO actions.
Table 1 below shows that:
- The 2022–23 estimate is about $2 million higher than the 2021–22 estimate.
- The IEA estimate as a percentage of total SMSF assets has remained stable at 0.03%.
- Total assets have increased by $78,212.0 million since 2021–22.
The overall reduction for non-lodgers has been driven by a significant decrease in the lapsed-lodger estimate, while the never-lodger component of the non-lodgers estimate has increased (see Table 2).
Findings
Illegal early access is the most significant regulatory risk impacting the SMSF sector.
In both lodging and non-lodging funds, it is driven by a wide set of circumstances, including:
- financial stress
- promoters and schemes
- lack of knowledge
- community attitudes to super.
The estimate for lodging funds is less than for non-lodging funds. This reflects enhanced controls, with these SMSFs being reviewed by approved auditors prior to lodgment.
The calculation estimates that 21.5% of the assets of SMSFs that never lodge have been early accessed. This contrasts with lapsed-lodgers and lodgers, where analysis shows only 0.18% and 0.01% (respectively) of assets leave the system illegally in these populations.
Total early access of $259.6 million consists of:
- estimated illegal early access of $252.0 million
- $7.6 million of legal early access, from
- compassionate release
- the first home super saver (FHSS) scheme.
Therefore, illegal early access is estimated to comprise around 97.1% of total early access.
Prohibited loans estimate
As part of the IEA estimation process, we also estimate how much money has been accessed from SMSFs through prohibited loans. Prohibited loans are loans made to an SMSF member, their relative, or any related party that exceeds the in-house asset limit of 5%.
Prohibited loans are a similar non-compliance behaviour to IEA and also pose a significant risk to the SMSF system.
The prohibited loans estimate follows the same method as the IEA estimate. The estimate only includes prohibited loan withdrawals made during the 2022–23 year and does not include outstanding amounts loaned in previous years.
For 2022–23, we estimate SMSF prohibited loans to be $397.7 million. The estimate has increased significantly compared with the 2021–22 estimate of $282.0 million.
Return to Self-managed superannuation funds illegal early access.