Date amended:
The two main types of superannuation funds

The following table shows the differences in treatment of contributions and benefits between the two main types of superannuation funds.


Fund type



Accumulation or defined contribution

Defined for employers and employees such as a percentage of salary

Lump sum - Amount depends on performance of fund and amount of contributions.

Defined benefit

Employee's contributions defined.

Employers contribute whatever additional amounts are needed to meet fund's obligations to its beneficiaries.


  • Lump sum;
  • Income stream; or
  • Combination of both.

Amount is usually based on final salary or average final salary (often the last 3 years) x a multiple. The multiple itself is usually a combination of length of membership and a percentage of final salary for each year of service.

Examples of superannuation schemes

The various types of employer sponsored and personal superannuation schemes include:

  • Public sector funds established for Australian and state government employees,
  • Corporate funds established by medium to large private sector companies for their employees,
  • Industry, or multi employer, funds for paying employer contributions to superannuation for employees covered by particular awards,
  • Self-managed superannuation funds (SMSF) and small APRA funds,     


    Description of Self Managed Superannuation Funds and Small APRA Funds

    10.5.5/Description of Self Managed Superannuation Funds and Small APRA Funds

    More ? (go back)

  • ATO Small Superannuation Accounts, designed for employer contributions which any other superannuation fund will not accept,
  • Retirement savings accounts offered by banks,
  • Retail funds or public offer funds, covering superannuation funds available to the general public, including employers and the self employed.