What is the minimum and maximum age to start a self managed super fund?

You can set up a self-managed super fund (SMSF or DIY fund) at any age, but individuals are not permitted to make super contributions beyond the age of 74. You can however rollover (transfer) a current super benefit after the age of 74.

If you wish to make further contributions to the SMSF between the age of 65-74, then you must satisfy a work test: working 40 hours in one 30-day period in the financial year in which you intend to contribute.

An individual under the age of 18 can be a member of a SMSF, but he can’t be a trustee. Trustees of super funds must be 18 years of age or over. If under 18 parent or guardian can be a trustee for the member.

The annual non-concessional (after-tax) contributions cap is $150,000 a year (for the 2010/2011 year, and for the 2011/2012 year), although Australians under the age of 65 have the opportunity to bring forward 2 years’ worth of non-concessional contributions.

The bring-forward rule means that it is possible to make up to $450,000 (for the 2010/2011 year) in non-concessional contributions in a single financial year, or, say, $300,000 in the first year and the balance of $150,000 over the following 2 years. Once you contribute more than $150,000 in a financial year, you automatically trigger the bring-forward rules for the following 2 years.

If you’re aged 65 or over, however, the bring-forward rule is not available. The maximum an individual aged 65 or over can contribute is $150,000 a year (for the 2010/2011 year, and for the 2011/2012 year) in a single financial year, and they must also satisfy a work test. If a person is aged 65 years or over and exceeds the $150,000 non-concessional cap, then the excess contributions are subject to a whopping 46.5% penalty tax.

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