The SMSF Trustee Declaration

SMSF Trustee DeclarationSince 30 June 2007 it has been a requirement for new trustees of SMSFs, or directors of the corporate trustee of a SMSF, to sign the Trustee DeclarationThe trustee declaration summarises many of the duties and restrictions of a  SMSF trustee and should be read carefully and understood, along with the ATOs ‘Self-managed super funds – key messages for trustees‘.

s104A of the Superannuation Industry (Supervision) Act 1993 requires that if a person becomes a trustee of an SMSF, or the director of a corporate trustee of an SMSF, they must:

  • Sign the Trustee Declaration within 21 days of becoming a trustee/director
  • Ensure the Declaration is kept for at least 10 years
  • Present the Declaration to the Regulator if requested

However similar requirements also apply to people who were trustees/directors prior to 30 June 2007 where a new person becomes a trustee/director, they must:

  • Ensure the new person signs a Trustee Declaration
  • Ensure the Declaration is kept for at least 10 years
  • Present the Declaration to the Regulator if requested

Breaching any of these requirements can attract a fine of 50 penalty units, currently a total of $ 8,500.

Some of the common issues with Trustee Declarations are:

  • Not signed
  • Not retained
  • Not witnessed
  • Only one trustee has signed a declaration
  • All trustees have signed the same declaration

Some other things to keep in mind:

  • The trustee declaration also needs to be signed by a person acting as Legal Personal Representative where they become trustee/director on behalf of another person – such as where a member has died
  • The Trustee Declaration has changed over time, for example it now refers to the requirement to consider insurance in the Investment Strategy.
  • As part of the new powers recently granted to the ATO a trustee who receives a Education Direction will have to sign, or re-sign, a Trustee Declaration.

More information regarding the trustee declaration is available on the ATOs website.

 

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