Your Guide to Being an SMSF Trustee

June 1, 2022
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SMSF Trustee

You’ve done your research, and you want more control when it comes to managing your retirement savings, so after receiving personalised advice you’ve decided to make a move to a self-managed super fund (SMSF).When it comes to structuring the legal entity of the SMSF, all members are required to be involved in managing the fund and are responsible for complying with relevant super and tax laws. One way that legislation ensures a member’s involvement, is to stipulate that they will be connected as a trustee of the fund.As an SMSF trustee, you have a number of responsibilities and obligations to uphold.

Understanding Your Role as an SMSF Trustee

Choosing to set up an SMSF shouldn’t be a decision made lightly. It should be a considered and informed choice made with the help of a professional with expertise in all areas of SMSF and your personal situation.Being a trustee carries specific responsibilities. Here are some things you’ll need to do:

  • Comply with SMSF administration, reporting, taxation and auditing requirements
  • Act in accordance with the SMSF’s trust deed
  • Act honestly and with diligence
  • Understand member eligibility to contribute
  • Know and understand benefit payment rules
  • Update the trust deed if required
  • Conduct a regular review the funds’ investment strategy

Should I Choose a Corporate or Personal Trustee?

If you’re well on your way to moving your retirement savings over to an SMSF, you may have already made this decision – but if you’re still considering your options, it’s important to consider the investment strategy and future goals of the fund to determine the most appropriate option.You have the option of choosing a personal trustee or a corporate (company) trustee. Whether you choose a personal or corporate trustee, all members will be required to play an active role in managing the fund. And like with most financial decisions – there are pros and cons for both choices.The trustee type you choose can have implications on trustee requirements, asset ownership, penalties and succession. You can read about this in more detail here.

Questions to Consider When Making Decisions on Behalf of Your SMSF

Once you’ve decided that an SMSF is the best option for managing your retirement funds and you’ve done all your paperwork, you’ll have ongoing decisions to make on behalf of the fund. It’s helpful to ask yourself these questions to know that you’re making the right decisions.

  • Does this decision meet the sole purpose test?
  • Is this decision in the best interest of all members?
  • Are all trustees/members in agreement?
  • Would a reasonable person make the same decision?
  • Does this decision fit with the investment strategy of the fund?
  • Is the investment at arm’s length?
  • Are there any conflicting opinions or laws that may prohibit or limit my ability to act on a decision?

Still Unsure About Whether an SMSF is Right for You?

If you’re still unsure about whether an SMSF is for you or even if you’re just looking for a second opinion – we can help. We can explain your options in clear and simple terms and work out what suits you based on your individual goals.

We can help make managing your SMSF responsibilities and obligations easier. Contact us here or call us on 1300 27 28 29 for a chat.

Book an appointment! blog has been prepared by RJS Wealth Management Pty. Ltd. ABN 24 156 207 126. RJS Wealth Management Pty. Ltd. is a Corporate Authorised Representative (No. 438158) of Modoras Pty. Ltd. ABN 86 068 034 908 an Australian Financial Services and Credit Licensee (Number 233209). The information and opinions contained in this blog is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). No individuals personal circumstances have been taken into consideration for the preparation of this material. Any individual making a decision to buy, sell or hold any particular financial product should make their own assessment taking into account their own particular circumstances. The information and opinions herein do not constitute any recommendation to purchase, sell or hold any particular financial product. Modoras Pty Ltd recommends that no financial product or financial service be acquired or disposed of or financial strategy adopted without you first obtaining professional personal financial advice suitable and appropriate to your own personal needs, objectives, goals and circumstances. Information, forecasts and opinions contained in this blog can change without notice. Modoras Pty. Ltd. does not guarantee the accuracy of the information at any particular time. Although care has been exercised in compiling the information contained within, Modoras Pty. Ltd. does not warrant that the articles within are free from errors, inaccuracies or omissions. To the extent permissible by law, neither Modoras Pty. Ltd. nor its employees, representatives or agents (including associated and affiliated companies) accept liability for loss or damages incurred as a result of a person acting in reliance of this publication.

June 1, 2022

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