You are building the update SMSF Deed. It updates your Self-Managed Superannuation Fund for:
1. Trustees (one company or up to 6 trustees)
2. Members (one to 6)
3. Deed (full replacement)
Legal Consolidated Barristers & Solicitors automatically puts in all Deed updates. These are required for the:
1. new Superannuation legislation; and
2. the budget changes.
Build this Update SMSF Deed. You get:
1. Deed of Variation – updates your SMSF Deed, the Trustees and the Members (up to 6 members)
2. Binding Death Benefit Agreement
3. Minutes for the Trustee to accept the Deed of Variation
4. Product Disclosure Statement – fully updated
5. Letter on our law firm’s letterhead confirming the above. Signed by a partner of the law firm
The Superannuation laws have changed. An old SMSF Deed is dangerous. It contains irrelevant clauses. This increases your risk of exercising a power you’re no longer allowed. This results in the loss of the tax concessions.
Over the last 4 years, there have been 13 significant changes to superannuation legislation. These include:
* change concessional contribution cap
* Insurance – new satisfying conditions
* pension limits and changed payout rules
* Excess concessional contributions rules
* Investment strategy should now be reviewed annually
* Trustees must report assets at market value using new rules
* remuneration for certain non-trustee duties
* up to 6 members
The Trustee looks after the Self-Managed Superannuation Fund. The Member is the lucky person who will, one day, get the assets in the SMSF. The Member gets the assets after retirement.
Usually, the Trustees and Members are the same persons. The law requires that if you are one of the members then you must also be a trustee as well.
E.g. James and Jenny are the Members. They must, by law, also both be the Trustees.
An exception to this rule is if you have a company as your Trustee. This is called a ‘Corporate Trustee’. In that instance, the only Trustee, by law, must be your company. The only directors of the corporate trustee must be the members.
E.g. James and Jenny are the members. They have a company as the trustee. Both James and Jenny must, by law, be the only directors of the company.
An SMSF can have up to 6 members. They must all be trustees as well. But some States of Australia only allow for 4 trustees of a trust. (And an SMSF is a trust.) So if you have 5 or 6 members you should consider a company as trustee of the SMSF. In fact, most accountants recommend that an SMSF always have a company as trustee of the SMSF. This is irrespective of how many members in the SMSF. I think they are correct.
This Deed of Variation updates your Trustees and Members, even if they are dead or otherwise incapacitated.
As of 1 July 2021, non-listed companies are no longer allowed to prepare Special Purpose Financial Statements (SPFs). Instead they prepare the arduous General Purpose Financial Statements (GPFS). Small proprietary companies where 5% of their shareholders request GPFS to be prepared are included in the definition of companies that comply with this requirement.
This requirement also applies to SMSF, Trusts and Partnerships, but only where the founding Deed makes mention of AASB15 in its definition of income.
Happily, Legal Consolidated documents do not mention AASB15 in the definition of income.
Further, no Legal Consolidated documents require compliance with the arduous AASB15.
Q: Professor Davies, over the years my SMSF Deed has been updated 8 times. I am about to do the SMSF deeds ninth update. Why do you not mention the 8 updates in your Deed of Variation of a SMSF? I notice that your question and answers only require me to identify the SMSF Deed that first started the super fund.
A: You are correct. There is no reference to any previous variations. When you build the SMSF Deed update, on our law firm’s website, there are no questions on any updated SMSF deeds. We only identify the original SMSF deed that first established your Self-Managed Super Fund. We intentionally do not refer to any specific deeds of variations.
There is no legal requirement to refer to other updates. It only adds complexity, especially if you lose one of those updates.
Q: Do you need to review previous SMSF deeds and any variations? This is to see if the SMSF can be so varied?
A: The SIS legislation controls the Superannuation including SMSF. So most of the rules are in the SIS Legislation, not the SMSF Deed.
Secondly, the SMSF cannot ’embed’ any rules which prohibit the making of amendments or Deed of Variations. This is provided the SMSF updates are done via a ‘deed’. Only law firms can prepare deeds. We are a law firm and all our SMSF variations are done via a deed.
To show the breath of what you can do to a SMSF without triggering a resettlement you can even replace a lost SMSF deed.
Yes. Tax benefits are grandfathered and protected in all our SMSF Deed updates.
You are building your SMSF Deed update on a law firm’s website. Telephone us anytime to get legal advice.
Adj Professor, Dr Brett Davies, CTA, AIAMA, BJuris, LLB, Dip Ed, BArts(Hons), LLM, MBA, SJD
Legal Consolidated Barristers and Solicitors
National Australian law firm
National: 1800 141 612
Mobile: 0477 796 959
Email: [email protected]