So you have decided to become a trustee of your SMSF or self-managed super fund, many congratulations!! But, you must not take such decisions lightly.
As a trustee, the accountability of running the fund and complying with the law rests exclusively with you.
As a trustee, you are legally obliged to:
- Act justly in all matters regarding the fund.
- Act in the best welfares of all the fund associates.
- Keep the fund cash and asset distinct from any other personal or business money and possessions.
- Do Not withdraw money early.
- Bring in and implement new investment strategies.
Whether you’re in quest of advice and assistance from 3rd parties, such as of an accountant, registered company auditor or even a financial adviser, the final responsibility lies with you as the trustee.
Keep records intact
Under super and tax laws, it is mandatory that you keep the records intact.
Your account records must be updated with the current fund’s transactions and financial position, including past five years records.
These records need to be timely updated as they will be required by you to meet your tax and audit responsibilities and will even assist in the well-organized operation of your fund, otherwise, possibilities are there that you might have to take help of superannuation accounting services.
Do not borrow money
Self-managed super fund do not allow borrowing money. This is just to make sure that money is obtainable to pay out member paybacks at the time of retirement.
Purchasing assets from a related get together as a trustee, you aren’t permitted to obtain investments from a related get together of the account.
(Explore this link to find out more about responsibilities of becoming a self-managed super trustee in brief.)
There are exclusions to this guideline. Therefore, you are allowed to buy investments from a related get together where:
- The property is purchased at market value and is also either a stated security (e.g. Stocks) or is property used for business.
- The asset can be an in-house property that is significantly less than 5% of the fund’s total possessions.