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Interesting facts about new SMSFs over the past 12 months

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Funds with individual trustees
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Members under 45 years of age

Self-managed super funds (SMSF) can be a great way to provide for your retirement.

Once a decision has been made regarding setting up a SMSF, it’s important you are aware of your responsibilities and obligations as a trustee. The process in establishing an SMSF involves a range of important decisions to be made by you. These include:

Obtaining a trust deed

You need to obtain a trust deed for your SMSF which sets out the rules as to how the fund will operate. The deed will include important items such as how trustees and members are appointed, how and what the fund can invest in, the types of pensions that can be made and how death benefits can be paid (just to name a few).

Appointing a Trustee(s)

One of the most important initial decisions you will make is the trustee structure of your fund. Can you can to have individual trustees or have establish a company act as trustee. Generally, all members of the fund will need to be appointed as individual trustees or act as directors of the corporate trustee. Watch the ATO video on deciding the type of SMSF trustee – individual or corporate At the same time the fund trustee(s) are appointed, a range of other trustee resolutions will be created establishing the fund, appointing members and other service providers, etc.

Establishing a bank account

A basic trust law principle is that to create a trust, it must have assets. This applies to SMSFs, where the fund is not established until is holds assets. As a result, it is typically upon setting up the bank account and making an initial deposit that the fund is created and can then apply look to apply to become regulated as a self-managed super fund. The correct naming protocol on the fund bank account is imperative. For individual trustees: John & Jane Citizen ATF Citizen Family Super Fund For a corporate trustee: Citizen Super Pty Ltd ATF Citizen Family Super Fund * ATF = As Trustee For”

Signing the ATO Trustee Declaration

From 1 July 2007, all new fund trustees and directors of a corporate trustee must sign a trustee declaration acknowledging their understanding of the roles and responsibilities of operating a self-managed super fund. The ATO declaration must be signed, witnessed and held within the records of the fund for at least 10 years. Where a trustee fails to comply with their responsibilities as a trustee, the ATO can take action against the trustee personally via directive action, educative directions, issue administrative penalties and more. You can watch the ATO video on the trustee declaration to find out more.

Electing to become a regulated superannuation fund

Within 60 days of the fund being established, the trustees must have applied with the Australian Taxation Office for the fund to become a regulated superannuation fund. This application will also include the registration of the fund’s tax file number (TFN) and Australian Business Number (ABN).

Obtaining a tax file number (TFN) and Australian Business Number (ABN)

Along with the application to become a regulated superannuation fund, the fund will apply for a TFN and ABN. It is important to note that the ABN is the primary identifier for the self-managed super fund. Until the ABN has been issued and the ATO identified the SMSF to be correctly established, you will not be able to rollover any existing super accounts to your SMSF. You can check the status of a fund through the ATO’s SuperFundLookup website

Formulate the fund's investment strategy

A requirement of the super laws is for the trustees to prepare and regular review a written investment strategy for your SMSF. Importantly the fund trustees must give effect to an investment strategy that has regard to the whole of the fund circumstances including (but not limited to):

  • the risk and return of holding, making and realising fund investments;
  • diversification of fund investments;
  • the liquidity of investments, having regard to expected cash flow requirements;
  • the ability to discharge the fund’s existing and prospective liabilities; and
  • whether the fund trustees should hold a contract of insurance for one or more members of the fund

You can watch the ATO’s video on preparing an SMSF investment strategy.

Pricing

Fund Establishment

Individual Trustees
$600 + GST
  • Arrange for the preparation of fund’s trust deed
  • Provide applications to appoint the funds trustees
  • Provide applications to become a member of the fund
  • Prepare supporting trustee minutes & resolutions to establish the fund
  • Apply for fund’s TFN & ABN, along with election to become a regulated super fund
  • Setup an Electronic Service Address (ESA) for employer contributions to comply with Superstream
  • Provide ATO trustee declarations to be signed by all trustees Provide ATO forms for direction of contributions and rollovers
  • Provide an SMSF investment strategy for completion
  • Provide death benefit nomination information for completion
  • Review all completed documentation once returned

Fund Establishment

Corporate Trustee
$1,300 + GST
  • Establish a new special purpose trustee company
  • Provide all applications for directors and shareholders
  • Arrange for the preparation of fund’s trust deed
  • Provide applications to appoint the funds trustees
  • Provide applications to become a member of the fund
  • Prepare supporting trustee minutes & resolutions to establish the fund
  • Apply for fund’s TFN & ABN, along with election to become a regulated super fund
  • Setup an Electronic Service Address (ESA) for employer contributions to comply with Superstream
  • Provide ATO trustee declarations to be signed by all trustees
  • Provide ATO forms for direction of contributions and rollovers
  • Provide an SMSF investment strategy for completion
  • Provide death benefit nomination information for completion
  • Review all completed documentation once returned

For full details, please refer to the SMSF Service & Compliance Agreement

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