Choosing individual or corporate trustee

Whether to have a corporate or individual trustee structure is a matter of choice.  Arguments in favor of having a corporate trustee are that the assets of the fund are clearly separated from the individual trustees as they are registered in the name of the corporate trustee. There is also an ease with which members can change without having to change the registered details of each asset held by the fund.

The structure of a SMSF must meet certain requirements in terms of the law:

  • it must have four or fewer members,
  • each member must be a trustee / or director of the corporate trustee company
  • no member may be the employer of another (unless related)
  • no trustees are paid for their service

In the writers circumstances the corporate trustee option with the benefits outlined above, was was chosen, although more costly at the outset (approximately $620) and an ongoing, relatively low annual ASIC fee (approximately $50) for the company trustee.

Benefits from having a corporate trustee

The ATO provides information regarding these requirements, the costs, ownership of assets and succession benefits from having a corporate trustee.