A Self-Managed Super Fund (SMSF) is controlled and managed by the members of the fund. As such, the members, as trustees, make all the decisions about how the fund is run, what investments it holds and the type of benefits it can pay. The level of control and flexibility SMSFs allow are seen as some of their main advantages.
To be a SMSF, a fund must satisfy the following conditions:
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One member fund
Where a SMSF only has one member, different rules apply. In this case a one member fund will meet the definition of a SMSF if it satisfies the following conditions:
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In certain situations other people may be permitted to act as a fund trustee on a member’s behalf without causing the fund to fail the SMSF definition. These situations include where a member has deceased or is under a legal disability.
Who can be a member of a Self Managed Super Fund?
In general anyone can be a member of a superannuation fund. However, to be a trustee of a SMSF, each member must be a trustee, over age 18, not be under a legal disability or be a disqualified person. Where a member is under a legal disability or under age 18 another person (i.e. their legal personal representative or guardian) can be appointed to act as trustee on their behalf.
A person will be considered to be a disqualified person if they:
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Where a fund has a corporate trustee the company will be considered to be a disqualified person where:
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For more information on the definition of a self managed superannuation fund and details on who can be a trustee see “Self Managed Superannuation Funds – “Role and responsibilities of trustees” on the ATO website at www.ato.gov.au.
It is highly recommended that you speak to a financial adviser about your specific needs.
