More facts and figures on SMSFs

Estimated Value of selected property asset classes of SMSFs

Estimated value of geared and non-geared direct property holdings of SMSFs are:

•    LRBAs  -  $9.5b  (increase over 12 months of $401m)

•    Non-geared non-residential property  - $72.1b  (increase over 12 months of $7,587m)

•    Non-geared residential property  -  $21.779b (increase over 12 months of $2,291m)

Figures as at March 2015 (extracted 13 April 2015).

Limited Recourse Borrowing Arrangements (LRBAs)

As a percentage of asset values, LRBAs constitute:

•    3.16 % of total assets of funds in the $200,000 to $500,000 fund value range;

•    2.57% of total assets of funds in the $500,000 to $1,000,000 fund value range;

•    1.34% of total assets of funds in the $1m to $2m fund value range;

•    1.05% of total assets of funds in the $2m to $5m fund value range;

•    1.27% of total assets of funds in the $5m to $10m fund value range; and

•    2.74% of total assets of funds in the $10m plus fund value range.

In fund value ranges of less than $200,000, LRBAs constitute less than 1% of total fund assets in those ranges.

One comment and two qualifications need to be made.  The comment – on an aggregated basis, LRBAs are not distorting SMSF investments.  The first qualification is that the information is based upon the 2013 financial year and is not current (however, it is the most recently available).  The second qualification is that while on an aggregated basis the percentages are very low, it could be that there are particular funds within the fund value range which have either no LRBA investments or where the LRBA investments constitute a significant portion of the fund’s assets. 

Membership size of SMSFs

Almost 70% of all SMSFs are two member funds.  Single member funds constitute 23% of all SMSFs.  The balance of SMSFs (being slightly less than 8% of SMSFs) have either three members (3.9%) or four members (4.1%).

While this information is based upon the 2013 financial year, the relative proportions of single member and multi-member SMSFs have not materially changed over the four financial years to 2013. 

Location of SMSF

NSW is just maintaining its position as the capital state of SMSFs with 31.8% of all SMSFs located in NSW.  Victoria is second but is catching up to NSW with 31.1% of all SMSFs (four years previously, Victoria’s share was 29.8% compared to NSW with 31.5%).

The balance of SMSFs (37.1%) are located in descending order – Queensland (16.4%), Western Australia (10.3%), South Australia (7%), ACT (1.8%), Tasmania (1.4%) and the Northern Territory (0.2%).

The information is based upon the 2013 financial year.

Inflows and Outflows of SMSF

Based on ATO information extracted at July 2014, the inflows and outflows of SMSFs over the four financial years 2010 to 2013 are as follows:

The reason for the decline from the 2012 to the 2013 financial years of about $7,700m is primarily related to a material decrease in both employer contributions and member contributions to SMSFs.  Additionally, there was a material increase in benefit payments and almost a 100% increase in administrative and investment expenses (albeit from a low base).

Subsequent years’ figures will show whether SMSF inflows have peaked due to less SMSFs being established and more SMSFs moving into pension phase.