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Is your SMSF trust deed up to date?

Olivia Agosti  |  31 May 2017Text size  Decrease  Increase  |  

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It is essential that SMSFs have their trust deeds reviewed and revised to avoid being caught out following the upcoming superannuation changes on 1 July.

 

The end of financial year is fast approaching, and in light of the Fair and Sustainable Superannuation Changes, it's important for trustees to be assured their SMSF trust deed is up-to-date and compliant.

Case study

Daniel is a trustee of an SMSF. Accordingly, he is only permitted to act in accordance with the powers afforded to him under the trust deed.

Daniel hasn't updated his trust deed to provide him with the necessary powers to deal with his SMSF in accordance with the new changes to superannuation law.

If Daniel doesn't update his SMSF trust deed and acts outside the powers given to him, he could be in breach of trust, giving rise to serious penalties.

It's not too late to update your SMSF trust deed

Lucky for Daniel--it's not too late! The Fair and Sustainable Superannuation Changes largely commence on 1 July 2017.

It is essential that Daniel has his SMSF trust deed reviewed and revised now to avoid being caught out.

New trustee powers

Just some of the SMSF trustee powers that are now essential in respect of the legislative powers are:

1) Powers to permit different types of pensions to be commuted for the purpose of reducing or avoiding exceeding the transfer balance cap;

2) Powers to make catch-up concessional contributions; and

3) Powers to roll over death benefits.

To assist our clients, we offer updates of SMSF governing rules at various times throughout the year.

This service helps to keep SMSFs at the cutting edge of legal developments, and improves the flexibility for SMSF trustees.

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Olivia Agosti is a solicitor with Townsends Business & Corporate Lawyers. This is a financial news article to be used for non-commercial purposes and is not intended to provide financial advice of any kind. Opinions expressed herein are subject to change without notice and may differ or be contrary to the opinions or recommendations of Morningstar as a result of using different assumptions and criteria.

© 2017 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. This information is to be used for personal, non-commercial purposes only. No reproduction is permitted without the prior written consent of Morningstar. Any general advice or 'class service' have been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), or its Authorised Representatives, and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product's future performance. To obtain advice tailored to your situation, contact a licensed financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782 ("ASXO"). The article is current as at date of publication.