Self Managed Super » The Trustees

The Trustees

Generally anyone over 18 years of age can be a trustee of a SMSF (unless they’re a disqualified person) and the requirement that all members be trustees ensures that each member is involved in the decision making process and proper management of the fund.

The trustee of a self managed superannuation fund has powers including:

  • The appointment of professional advisers
  • Establishing the investment strategy
  • Making investments
  • Allowing members into the fund
  • Approval of payment to members
  • The rule of trusteeship for SMSF’s is that all members must be trustees, and all trustees must be the members. However, it is also possible to register a Company to act as trustee for the fund in which case all the members must be Directors of the trustee Company and only the members can be Directors of the trustee Company.

Some of the advantages of a corporate trustee are:

  • In a single member SMSF, if there is no suitable person to act as the other individual trustee, you can use a corporate trustee but you must be the sole Company Director
  • You may not wish to share the role of trustee but this cannot be achieved if there are individual human trustees (because there must be two for a sole member SMSF), but you can be the sole Director of a corporate trustee
  • It may allow an easier passage for multi-generational members in and out of the SMSF. However, there would have to be sufficient account balances to pay retirement and death benefits when needed. If this appeals, ask your accountant if there would be value or administrative efficiencies in a corporate trustee where the trustee remains the same and only the underlying Directors change
  • It may offer a degree of asset protection, however, opinions vary on this issue and depending on your situation, you should discuss it with your accountant

A corporate trustee also includes the expense of incorporation and annual fees so again we emphasize the importance of seeking professional advice.