SMSF Trust Deed & Declaration Templates: Where to Get Them

Running a self-managed super fund (SMSF) comes with many different roles, responsibilities and administrative requirements to ensure compliance in the fund. One of the first things you will need to arrange when setting up an SMSF is a trust deed. In this article, we will run through some general information about what an SMSF trust deed is and how you may choose to get one suitable for your needs.

What is a trust deed for SMSFs?

A trust deed for SMSFs is an important legal document that outlines how the SMSF operates and how the fund is set up. In conjunction with Australian super laws, the trust deed outlines the fund’s operational rules, details the responsibilities of the trustees, and dictates what the members of the fund are entitled to.

Why do you need a trust deed?

The requirement for a trust deed comes back to the SMSFs legal structure. An SMSF has to be set up as a trust, and this is because a company or individual trustee holds the fund’s assets in trust for the beneficiaries. A self-managed super fund is a particular type of trust that’s sole purpose is to provide retirement benefits to the fund’s members when they retire. So the fund can receive all the special tax benefits that a super fund receives, the fund must be set up in the right way and maintain compliance at all times. The Australian Tax Office oversees SMSFs ensure they are compliant with the superannuation legislation. Non-complying SMSFs may incur penalties, so it’s best to take the fund’s compliance seriously.

What does an SMSF trust deed look like?

The fund’s trust deed is a multiple page legal document and would generally include the following information:

• The framework on how the self-managed super fund can invest and what investment strategy is to be followed. The trustees of the fund must outline the investment strategy during the initial SMSF setup process, which includes the type of assets the fund can invest in and the investment and risk management process.
• A framework that outlines the administrative function of the SMSF, how the beneficiaries will receive funds in retirement, and how the fund can be wound up if it comes to that.
• Director names if the SMSF has been set up with a corporate trustee structure, or the names of the individual trustees and members of the fund if using the individual trustee structure.
• An SMSF is set up for the sole purpose of providing retirement benefits to the members of the fund or their dependants. This is the objective of the fund and will be included in any trust deed.

Where to get template documents for your self managed superannuation fund

While it’s possible to get self-managed superannuation fund trust deed templates online, this really depends on the complexity of your SMSF, structure type and investment strategy. The more complex the fund is, the more likely you are to need the oversight of a financial professional. Getting assistance will ensure the fund is compliant with super laws and legislation. It’s a good idea to involve all trustees, directors or members in the trust deed set-up process to ensure everyone has a clear understanding of how the SMSF will be managed from the beginning.

The following financial professionals can assist you in the set up of your SMSF trust deed:

• Accountants will help with the ABN registration and with the SMSF’s financial systems and when the fund is up and running, prepare the accounts and operating statements.
• Fund administrators can help with any administrative functions during the initial start-up and assist in managing the fund’s daily operations, including the reporting obligations.
• Lawyers can prepare and update the SMSF trust deed when required.
• Financial advisers can assist with professional advice for the preparation of the strategy for the fund’s investments and advise on the different investment products and insurance required.

How often should I update my SMSF trust deed template?

An SMSF trust deed should be reviewed at least once every year to ensure it’s up to date with any changes to superannuation legislation and any changes to the fund’s members. A good example of the importance of reviewing your SMSF trust deed is the changes in the transfer balance cap, which was introduced in July 2017. The cap is the total amount that can be transferred to any eligible member’s pension account tax-free and is currently $1.7 million in 2022, up from $1.6 million prior to the 1st of July 2021.

Another example is the before tax (concessional) and after-tax (non-concessional) caps on super contributions that are indexed each year. Changes to these caps impact the maximum amount that SMSF members can contribute to their SMSF each year. The annual concessional contributions cap increased from $25,000 to $27,500 on July 1st 2021, as did the non-concessional cap from $100,000 to $110,000.

How do I update my SMSF trust deed?

Any changes or deeds of variation to your SMSF trust deed should always be handled by experienced financial professionals to ensure the fund is compliant. Costs generally vary depending on the nature of the update and how extensive it is.

If any minor updates need to be made to cover things like grammatical or spelling errors of a member’s name, for example, a deed of variation can be used for this purpose. This is much more cost-effective than drafting and updating the trust deed itself. Any changes via a deed of variation need to be prepared and signed by all trustees/directors and attached to the SMSF trust deed.

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