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SMSF

As a trustee, what are my responsibilities?

By Olivia LongApril 13, 2020No Comments

Deciding to become a trustee of an SMSF is a positive step towards retirement planning, but it’s not a decision to be made lightly. It requires significant commitment to take charge of your financial future in retirement. Being an SMSF trustee carries specific and wide-ranging responsibilities and obligations that must be met on an ongoing basis.

Ultimately, as SMSF trustees, you are responsible for ensuring your SMSF is properly managed and complies with all rules, including super laws and the fund trust deed. These rules apply to you in your capacity as a trustee of the SMSF.

An SMSF must be run for the sole purpose of providing retirement benefits for members or their dependants. You shouldn’t start an SMSF to get early access to your super, to buy a holiday house or artworks to decorate your home.

The rules you need to follow as a trustee of an SMSF, include the following:

  • Act honestly in all matters concerning your fund.
  • Exercise skill and diligence in managing your fund.
  • Act in the best interest of all members at all times.
  • Keep the money and assets of your fund separate from other money and assets (for example, your personal assets).
  • Retain control over your fund.
  • Develop, implement and regularly review an investment strategy.
  • Consider if the fund should hold insurance cover for its members. n Do not enter into contracts or behave in a way that hinders you or other trustees from performing or exercising functions or powers.
  • Do not access or allow others to access funds early.

The SISA contains rules that impose minimum requirements on trustees and are deemed to be included in the trust deed of every regulated fund. These rules reflect the duties imposed on all trustees under trust law in general.

If you do not follow the rules, you risk one or more of the following:

  • your fund being deemed non-compliant and losing its tax concessions;
  • being disqualified as a trustee;
  • prosecution;
  • penalities.

 

This information is provided by ExpertSuper™ Pty Ltd ACN 628 032 888 (Authorised Representative No. 1274492). The information is general information only and does not take into account your objectives, financial situation or needs. You should obtain professional advice before acting on any of this information. Please refer to ExpertSuper’s FSG (available at https://www.expert-super.com.au/wp-content/uploads/2020/02/ES-Financial-Services-Guide.pdf) for contact information and information about any remuneration and associations with product issuers.