How To Set Up An Smsf
Theres a lot to do when setting up a self managed super fund properly
. Here is a simple guide so that you leave no stone unturned when taking control of your SMSF.Obtaining a Trust Deed
A trust deed is a legal document that outlines the rules for establishing and operating your fund. Together with the superannuation laws, this forms the funds governing rules and should detail the following information:
The powers, duties and responsibilities of the funds trustees
The rights of the members who belong to the fund (no more than four members are allowed on one SMSF)
The funds objectives
Who the trustees are
Who can be a trustee
How trustees are appointed or removed from the fund
Who can be a member
When contributions can be made to the self managed super fund
How and when benefits can be paid (either via pension or a lump sum) within the SISA requirements
How to appoint professional advisers, such as an auditor
The procedures for winding up or closing the fund
This is such an important document as it will guide and protect members and their nest egg. It is best to have this document drawn up by a professional such as a lawyer (alternatively if you are confident in doing it yourself you can purchase a deed kit).
Appointing Trustees
New funds usually appoint trustees under the funds trust deed. Dont forget that for your fund to be an SMSF, all members of the fund need to be trustees or directors of the company you have nominated. All trustees must consent in writing to being appointed to the SMSF and youll need to hold onto these records for a minimum of 10 years.
Signing a Trustee Declaration
Within 21 days of becoming a new trustee (or the director of a corporate trustee) youll need to ensure youve signed a declaration stating this has occurred. By signing this document, you are acknowledging your responsibilities and duties as a trustee of the fund. You should keep the declaration for as long as its relevant and must be available for review when the fund is being audited.
Electing the fund to become regulated
Once youve completed all the required documentation and signed on all the relevant trustees, youll then need to register the fund with the Australian Tax Office within 60 days of its establishment. Youll also need to apply for an Australian Business Number and Tax File Number for the fund itself.
Finally, youll need to open up a bank account in your SMSFs name. This allows you to manage the funds operations and accept cash contributions and rollovers from super benefits.
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