The following table shows the differences in treatment of contributions and benefits between the two main types of superannuation funds [2].
Fund type |
Contributions |
Benefits |
Accumulation or defined contribution |
Defined for employers and employees [2] 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. |
Either:
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. |
The various types of employer sponsored and personal superannuation schemes include:
Description of Self Managed Superannuation Funds and Small APRA Funds
10.5.5/Description of Self Managed Superannuation Funds and Small APRA Funds [4]
More ? (go back) [5]
A superannuation fund is defined in the VEA as being:
An employee is someone who is:
This is a fund with less than five members that does not meet the criteria for an SMSF. The trustee of an SAF must be a corporate trustee approved by APRA. The trustee may receive remuneration for acting as trustee.
An ATO small superannuation account is an account kept in the name of an individual under the Small Superannuation Accounts Act 1995.
Links
[1] https://clik.dva.gov.au/user/login?destination=node/16554%23comment-form
[2] https://clik.dva.gov.au/%23
[3] https://clik.dva.gov.au/book/export/html/16554#tgt-cspol_part10_ftn589
[4] https://clik.dva.gov.au/compensation-and-support-policy-library/part-10-types-income-and-assets/105-income-streams/1055-special-provisions-regarding-self-managed-superannuation-funds-and-small-apra-funds/description-self-managed-superannuation-funds-and-small-apra-funds
[5] https://clik.dva.gov.au/book/export/html/16554#ref-cspol_part10_ftn589
[6] http://clik.dva.gov.au/glossary/foreign-superannuation-fund