With Control Comes Responsibility

In an SMSF the trustees have control over the retirement savings of the fund members. It is essential that not only do they invest the SMSF assets in an appropriate way, but they also comply with all the obligations and responsibilities imposed on them by the legislation.

The Australian Taxation Office requires all new trustees of SMSFs to complete the trustee declaration. This explains the ‘sole purpose’ test; lists the trustee’s duties; details investment restrictions and sets out some contributions and administrative duties and requirements. Trustees are now required to sign an acknowledgement that they understand the requirements of being a trustee, as is set out in the document as part of the requirements to establish a fund.

The Australian Taxation Office (ATO) has published a series of documents on its website (Self-managed super funds) with a landing page titled Self-managed super funds. This contains ATO guidance and expectations on numerous areas of SMSF establishment and operation, which should be understood by trustees.