The report, compiled by Quantum Financial Planning, indicates the proportion of SMSFs with a corporate trustee has fallen from 27 per cent in 2011 down to 23 per cent in 2014.
According to the report, 77 per cent or 410,995 SMSFs still have individual trustees.
It also showed that out of all SMSF registrations in 2013, only 8 per cent were set up as corporate trustees with the remaining 92 per cent were established with individual trustees.
“Despite the fact we typically prefer a corporate trustee for most of our clients, we believe SMSF members are talking with their feet and choosing to be in individual trustees due to the cost and perception of increased complexity,” said Quantum Financial Planning.
Another finding in the report was that member contributions have increased in relative weight, despite concessional caps having fallen.
In 2013 member contributions accounted for 74 per cent of the total average member contributions compared to 2009 when they accounted for only 61 per cent of all contributions, according to the report.
The average total contribution for an SMSF member, however, has fallen from $144,000 in 2009 to $106,000 in 2013.
According to Quantum Financial Planning, the percentage of SMSFs in accumulation phase has also fallen, decreasing from 70 per cent in 2009 to 63 per cent in 2013.
Ralph I strongly disagree.
A corporate trustee is the only way to go when mum & dad are in their 60+. The crap yo have to go thru to change trustee (say on death) is all totally avoidable when corporate is in place. The costs to setup the trustee are about $600 to $800 with the S’fund deed extra) with about $45 pa to run. I would argue that if that cost is too much then maybe a SMSF is not in your best interest.
Oops yes the “totally exposed” was a bit over the top and came from the recent frustration of helping a widow sort out a property title that had been really messed up at purchase and never fixed up. The paperwork involved and just getting them to accept the husband was dead was a nightmare. Hence my over reaction a Corporate Trustee would have solved all the issues with the title.
[quote name=”@SMSFCOACH”]Clearly there are providers out there looking a minimum cost SMSF set up to get the admin at the risk of leaving their new clients totally exposed.[/quote]
“Totally exposed”???
Seems a bit over the top. It is not as if having individual trustees will cause a fund to fail or become non-compliant. A bit too much Chicken Little perhaps?
If the fund doesn’t want to gear into property and the expectation is that the money will run out at age 80 then having individual trustees would be a cost effective option.
Clearly there are providers out there looking a minimum cost SMSF set up to get the admin at the risk of leaving their new clients totally exposed.