The Importance of Regularly Reviewing Your SMSF Trust Deed
A Self-Managed Superannuation Fund (SMSF) operates as a trust, governed by a set of rules outlined in its trust deed. This document is crucial as it defines what your SMSF can and cannot do, guiding its operations and ensuring compliance with the law. However, many SMSF trustees overlook the need for regular reviews and updates of their trust deeds, leading to potential issues with fund management and estate planning.
Why Your SMSF Needs a Trust Deed
The Role of the Trust Deed
- Rule Book: The trust deed acts as the rule book for your SMSF, detailing permissible activities and restrictions.
- Legal Compliance: While legislation allows for certain actions within super funds, your trust deed must specifically permit these actions for them to be valid.
Example: Binding Death Benefit Nominations
- Legislative Allowance: Current legislation permits non-lapsing binding death benefit nominations, which ensure that death benefits are distributed according to your wishes without needing to update nominations regularly.
- Trust Deed Requirement: To implement a non-lapsing nomination, your trust deed must explicitly allow it. Older deeds might require updates every three years, making non-lapsing nominations invalid if the deed does not accommodate them.
The Importance of Regular Reviews
Why Regular Review is Essential
- Avoiding Issues: Regularly reviewing your trust deed helps prevent potential issues with invalid nominations and ensures that your SMSF complies with current legislation.
- Adapting to Changes: Legislative changes can affect what is permissible within your SMSF. Regular reviews ensure that your trust deed remains up-to-date and relevant.
Recommended Review Frequency
- Every 5 Years: It is generally advised to review your trust deed every five years, especially when there are legislative changes to superannuation laws.
Options for Updating Your Trust Deed
Minor Changes
- Deed of Variation: For minor amendments, a deed of variation can be used. This document outlines the changes and is attached to the original trust deed.
Major Changes
- New Deed: If significant changes are needed, a new trust deed must be established. This ensures that the updated rules and provisions are fully integrated.
Professional Assistance
If it has been five or more years since your last SMSF update, talk to us so we can provide a qualified lawyer experienced in SMSF trust deeds. We can provide expert guidance and ensure that your trust deed is l legally compliant and aligned with your financial goals and estate plans
Need help with your accounting?
In your 50s and thinking about retirement? Discover 10 practical strategies to boost your super and get your retirement savings on track.
Buying your first home? From deposit schemes to stamp duty concessions, here are 5 government schemes that could help you get into the market sooner.
A new way to claim work-related expenses is coming for the 2027 tax return — but there is an important catch. From 1 July 2026, eligible taxpayers can claim a standard deduction of up to $1,000 for certain work-related expenses, without having to substantiate each expense individually. Sounds simple enough. But before you assume you can claim $1,000 on top of everything else, there are a few things you need to know. The $1,000 Is the Maximum The new standard deduction is capped at $1,000. It is designed to cover certain common work-related expenses, such as work-related phone and internet, home office expenses, stationery and some travel expenses. You can't claim the $1,000 and then claim those same expenses again separately. If you have actual work-related expenses of more than $1,000, you can continue to claim your actual expenses under the existing rules, provided you meet the requirements and have the records to support them. Do I Still Need to Keep My Receipts? Yes: and this is where it is worth being organised. If you use the standard deduction, you don't need to substantiate the individual expenses covered by it. But if you think your actual work-related expenses could be more than $1,000, keeping your receipts and records throughout the year will allow you to claim your actual expenses instead. There are also some deductions that aren't covered by the standard deduction and can still be claimed separately if you are eligible. It's for Your 2027 Tax Return The new deduction applies from the 2026–27 financial year, so you won't use it for the tax return you are preparing now. It will first apply to your 2027 tax return, lodged from July 2027. Is the $1,000 a $1,000 Tax Refund? No. The $1,000 is a deduction from your taxable income. It doesn't mean you'll receive an extra $1,000 back from the ATO. The value of the deduction will depend on your individual tax circumstances. What Should You Do Now? The best thing you can do is keep track of your work-related expenses throughout the 2026–27 financial year. When it comes time to prepare your 2027 tax return, we can look at your circumstances and determine whether the standard deduction or claiming your actual expenses is likely to give you the better outcome. At Ascent Accountants, we can help you make sense of the new rules and make sure you're claiming the deductions you're entitled to: without claiming the same expense twice!
Late paying super under Payday Super? Learn the new deadlines, penalties, and the one step that can reduce your Administration Uplift charge.
Received a business name or company renewal notice that looks official? Learn how to spot a fake ASIC notice before you pay.
Negative gearing is changing from 1 July 2027. Find out what it means for established properties, new builds, and your next investment.
