The ATO could make it compulsory for SMSFs to be established with a corporate trustee as soon as this year, according to a former president of the Association of Financial Advisers.
Speaking to SMSF Adviser, Paramount Wealth Management principal Wayne Leggett pointed to suggestions being made late last year as to whether it will be a requirement to have corporate trustees.
“It wouldn’t surprise me if it was brought in this year,” said Mr Leggett. “It makes sense to have it legislated as long as they don’t require retrospective changes because there’d be a lot of funds out there with mum-and-dad trustees and you wouldn’t want them to have the hassle and expense of changing if there was no particular benefit.”
Mr Leggett echoed widespread views across the industry in suggesting corporate trustee structures, by and large, make a fund’s asset ownership much clearer.
“With mum-and-dad members that are trustees, sometimes there is confusion as to whether the asset belongs to the super fund or them jointly,” said Mr Legget.
Mr Leggett therefore stressed compulsion should only apply to new funds, but not existing funds.
“Changing trustees if you’ve got extensive assets becomes very difficult because of the paperwork required so if an existing fund isn’t gaining any benefit from doing it then they’re incurring a lot of expense and no gain.”
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