ATO to implement system changes for new increase in SMSF membership
The ATO is implementing new system changes to accommodate the new measures that have expanded the membership limit to six in SMSFs.
The recently passed Treasury Laws Amendment (Self-Managed Superannuation Funds) Bill 2020 received royal assent on 22 June 2021. From 1 July 2021, self-managed super funds (SMSF) and small APRA funds (SAFs) will be able to have up to six members.
In a recent online update, the ATO said it is currently implementing the necessary system changes to enable SMSFs to add members five and six to their fund through the Australian Business Register (ABR).
“We recommend you wait until the ABR is updated before you register or update your fund with more than four members,” the ATO said.
“If this is not possible, an interim solution will be available from 1 July 2021 and can be used to add a fifth or sixth member.”
Meanwhile, for SMSFs considering expanding the fund, the ATO advised they will need to consider things such as what your fund’s trust deed allows, the structure of your fund and its reporting requirements.
“Some state and territory laws restrict the number of trustees a trust can have. Because an SMSF is a type of trust, your fund may be impacted by these restrictions,” the ATO explained.
“To avoid this issue, you can set up your SMSF with a corporate trustee and each member as a director of the corporate trustee.
“It is important to seek professional advice and check state or territory law restrictions before registering or expanding your fund.”
Tony Zhang
Tony Zhang is a journalist at Accountants Daily, which is the leading source of news, strategy and educational content for professionals working in the accounting sector.
Since joining the Momentum Media team in 2020, Tony has written for a range of its publications including Lawyers Weekly, Adviser Innovation, ifa and SMSF Adviser. He has been full-time on Accountants Daily since September 2021.
