History of SMSF
On the 8th of October 1999 the Superannuation Legislation Amendment Act (No.3) received assent from the House of Representatives. This amendment to the Act, commencing from 1 July 1999, introduced two new categories to be included under superannuation law: SMSF and Small APRA Funds. Prior to this change in the legislation these smaller funds, which contained fewer than five members, were treated as being “Excluded Funds” and were regulated by APRA.
The change to the legislation also came with a change of regulator for SMFS, with the Australian Taxation Office (ATO) being made responsible for regulating these funds to ensure they comply with the SIS Act and SIS Regulations. This change in regulator came out of the belief that self managed funds should not be subject to the same prudential regulations as larger funds and as such, SMSFs are now exempted from some of the more onerous requirements of the SIS Act.
Since 1999 there have been many changes to the legislation, from changes to pensions and the inclusion of borrowing rules in 2007 through to the recent changes including the Total Superannuation Balance Caps and pension Transfer Balance Caps.
In June 2001 there were 210,667 SMSFs with assets of approximately $78 billion, or 30% of the total superannuation assets. Today, SMSFs are the largest superannuation fund sector in Australia. As of June 30, 2018, SMSFs hold approximately $750 billion of assets in 596,225 funds which accounts for 27.6 percent of the total superannuation fund assets*.
*statistics from APRA Quarterly Superannuation Performance Report reissued 31 August 2018