SMSFs urged to review segregation clauses in trust deed
With the rules around segregation changing, SMSF trustees wanting to run separate investment portfolios for different members may need to check the current terms in their deed allow for this, says an SMSF admin firm.
Heffron SMSF Solutions head of customer Meg Heffron says while a fund’s ability to segregate its assets will change from 1 July 2017 for those with larger balances, this will not impact their ability to run different investment portfolios.
“It doesn’t change the trustee’s ability to allow members to choose specific investments to underpin their account. It just means that arrangement can’t be reflected in the fund’s tax return,” Ms Heffron said.
Many trust deeds treat segregation and member investment choice as the same thing. However, “ruling funds out of some valuable strategic planning opportunities,” she said.
“[The deed needs] to make it very clear that the two things are different and that you can run a different investment portfolio to someone else without segregating the asset.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.