As a corporate trustee of a self-managed super fund, SMSF compliance is one of your top priorities. Recently there has been some flow-on impacts to super laws thanks to changes in insolvency laws.
If you want to keep up with super legislation then we encourage you to keep reading as we bring your attention to important changes that could affect how you declare that your corporate trustee is not disqualified.
What’s changed for an SMSF corporate trustee?
SMSF Trustees, regardless of whether they are individual trustees or corporate trustees should be acutely aware of their trustee duties.
For SMSFs that are run under a company structure where there’s also a business being operated, their corporate trustee could be disqualified from their ability to manage the SMSF due to a new category of ‘disqualified persons’ being introduced by insolvency laws. Should a corporate trustee of an SMSF face insolvency, then they will automatically be disqualified from managing a superannuation entity.
The changes came about effective the 8th of December 2021, thanks to insolvency law updates affecting the Corporations Act and therefore having an impact on superannuation legislation via the Superannuation Industry (Supervision) (SIS) Act.
What the changes mean for your existing Self Managed Super Fund
One of your duties as a self managed super fund SMSF trustee is to understand your obligations and responsibilities, so it’s only natural that you’d wonder what new disclosure requirements have been introduced as a result of the changes.
Essentially, your declaration requirements were only necessary when you completed an ATO SMSF Trustee declaration, however now, the declaration could be required annually.
- – The Australian Taxation Office will update its forms to include an additional declaration question. The question will need to be answered to state that there has been no appointment of a restructuring practitioner to the corporate trustee. The changes to ATO forms will likely also be applied to the ATO SMSF Trustee Declaration document.
- – When a new trustee is appointed, the super law requirement is that they have a ‘consent to act’ document prepared when the trustee agrees to be a fund trustee. This obviously can’t occur if the corporate trustee is disqualified, so an extra line will need to be included in any consent to act documentation, which confirms that no one in any of the documents is a disqualified person.
- – Additional declarations will also need to be included into the SMSF’s year-end documents, created by the same person who did the accounts for the Corporate SMSF. Given that the definition for a disqualified person has been expanded, it would be prudent to align any disclaimers directly in line with the definition as found under the SIS Act.
What do I need to update with the changes?
Determining what changes are required to be made is easier when you seek professional advice from industry professionals. The accountant that manages your SMSF annual return and tax requirements will be able to guide you on modifying any documentation to avoid non-compliance.
If you’re looking at setting up an SMSF, and would like to know more about:
- – SMSF trustee structures such as choosing between an individual trustee or corporate trustee.
- – How many fund members you can have.
- – The rules around self managed super funds.
- – Or even your investment strategy, investment decisions or assets, including how to borrow to invest in property using your self managed super fund.
Then connect with us today.
We aren’t just SMSF Loan Experts, our services include placing you in front of professionals who take into account your personal objectives to get your new SMSF set up.