Why do I need a Product Disclosure Statement for my Self-managed Super fund?

It is for the protection of the trustees as individuals

Originally when the legislation passed to require a Product Disclosure Statement for a SMSF many lawyers couldn’t understand their value.

However, now it would be a brave lawyer who says you don’t need one.

This is because the PDS protects the Trustees as individuals. The PDS also protects the financial adviser, accountant, auditor, lawyer and other professionals that help you look after the SMSF.

What do I get when I build this document?

Because you are building your document directly at a law firm’s website you:

• Retain Legal Professional Privilege
• Benefit from our law firm’s Professional Indemnity Insurance
• Receive legal advice

Upon building this document, you receive as a PDF:

• Updated Product Disclosure Statement (compliant for both accumulation and pension phases)
• Minutes for the Trustee to accept the Product Disclosure Statement
• Letter on our law firm’s letterhead confirming the above. Signed by a partner of the law firm.

There is a tax requirement to keep your SMSF compliant

The Australian federal government provides generous tax concessions that come from operating a ‘compliant’ self-managed superannuation fund (SMSF). However, it must be compliant. To be compliant:

• Your fund must only ever have a maximum of 4 members at one time. You can have 1, 2, 3 or 4 members.
• Each member must be a trustee. Each trustee must be a member. (Unless you have a company as trustee or unless there are minors as members.)
• Instead of having all the members, as trustees, you can have a company. This is called a corporate trustee. Each member must be a director of the company. Only members can be directors.
• You cannot have someone you employ as a member with you. This is unless that employee is related to you.
• The trustee is a volunteer – a trustee can never draw a salary or fees for performing the job of trustee.
• All members and trustees should be Australian residents, otherwise you face complexity.

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Dr Brett Davies, CTA, AIAMA, BJuris, LLB, Dip Ed, BArts(Hons), LLM, MBA, SJD
Legal Consolidated Barristers and Solicitors
Toll free: 1800 14 16 12
Mobile: 04777-96959
Email: brett@legalconsolidated.com
Skype: brettkennethdavies