CSLR Levy and SMSF Governance Reforms: What Is Proposed, Not Law

Two proposals now sit alongside the rules that currently govern self-managed super funds. One would eventually bring SMSFs into the levy that funds the Compensation Scheme of Last Resort (CSLR). The other is a wider package of SMSF governance reforms covering trustee education, bank accounts and investment strategies. Both were set out by Treasury on 18 August 2026 and announced the following day by the Assistant Treasurer. Neither has been introduced to Parliament as legislation, and neither changes an SMSF trustee's obligations today.

What the CSLR actually is

The Compensation Scheme of Last Resort began operating on 2 April 2024. It is an industry-funded, government-established scheme that pays compensation of up to $150,000 to a consumer with an unpaid determination from the Australian Financial Complaints Authority, where that determination relates to personal financial advice, credit intermediation, securities dealing or credit provision and the responsible firm cannot pay, as ASIC explains on its CSLR page. ASIC administers the scheme's industry levies on the CSLR operator's behalf, funded since 1 July 2024.

Two levy types exist: an annual levy paid every year by defined subsectors, and a special levy imposed on top of it when a subsector's revised costs exceed its levy cap for that period, as set out in ASIC's guidance on the CSLR annual levy and the CSLR special levy.

SMSFs are not currently levied, but that is what is being proposed

Four subsectors currently pay the CSLR annual levy:

• Financial advisers giving personal advice on relevant products to retail clients
• Credit providers
• Credit intermediaries
• Securities dealers

SMSFs and SMSF trustees are not one of those four subsectors, and an SMSF does not currently pay a CSLR levy in its own right. That is precisely the change under discussion.

In a fact sheet dated 18 August 2026, Treasury set out a proposal to include all SMSFs as levy payers in the CSLR's special levy model "in future years when a special levy is required." The total levy for the SMSF sector would be scaled to assets under management relative to the broader superannuation trustees sub-sector, with a flat amount applying to every fund, though that amount has not been set. The same fact sheet also proposes limiting CSLR payments to actual losses, rather than hypothetical losses, for AFCA applications lodged after 30 June 2027.

None of this has passed into law. It has not been introduced to Parliament, and the per-fund amount an SMSF might eventually pay has not been finalised.

A separate reform package covers SMSF governance

Alongside the CSLR proposal, Assistant Treasurer Dr Daniel Mulino announced a wider package of superannuation reforms on 19 August 2026, following the well-publicised collapses of the Shield and First Guardian managed investment schemes. Part of that package deals with the SMSF sector specifically, and is worth treating as separate from the CSLR change above: it concerns how SMSFs are set up and governed, not who funds compensation payouts. Treasury's fact sheet sets out several specific measures:

• Giving the ATO power to prevent rollovers into a new SMSF where the ATO is investigating fraud, financial abuse, misconduct or potential harm
• Mandatory trustee education, to be completed before a new SMSF can be registered
• A requirement for every SMSF to hold a uniquely identifiable bank account
• A requirement to have a written investment strategy in place upfront, alongside separate consultation on improving the quality of investment strategies generally
• Giving the ATO the ability to collect more information on the advisers and other parties involved in setting up a fund and in ongoing advice fee deduction arrangements
• Increasing the SMSF supervisory levy from $259 to $295, the first change to that levy since 2013
• Giving SMSF trustees, particularly those with low balances, better visibility of how their fund's returns compare with an APRA-regulated fund

Has any of this become law?

No. As at publication, none of these measures has been introduced to Parliament as a bill, on either the CSLR levy proposal or the SMSF governance package. They remain government proposals set out in a Treasury fact sheet and a ministerial announcement, and some elements are still open for consultation.

Current SMSF rules apply unchanged in the meantime. The SMSF supervisory levy payable today is still $259, not $295, and no SMSF currently pays a CSLR levy of any kind.

What this means for SMSF trustees now

None of this requires an SMSF trustee to do anything differently today. Existing obligations under superannuation law, including preparing and maintaining an investment strategy and reporting to the ATO, continue to apply exactly as before.

The direction of travel is clear enough, though. More documentation at set-up, more ATO oversight of rollovers, and eventually a modest, flat CSLR contribution from every SMSF once a special levy is triggered.

If you run an SMSF, or are weighing one up, it is worth understanding where these proposals are heading well before any of them become compulsory. Get in touch and we can talk through what it would mean for your fund specifically.

Disclaimer: This article contains general information only and does not constitute financial, legal or tax advice. It has been prepared without regard to your objectives, financial situation or needs. Tax and superannuation laws change frequently, and the information in this article may not reflect the current law or may become inaccurate over time. Before acting on anything in this article, you should consider its appropriateness to your circumstances and seek advice from a registered tax agent or qualified adviser.