CHANGING SMSF FROM INDIVIDUAL TRUSTEES TO CORPORATE TRUSTEE
NOTES ABOUT WHO SHOULD BE DIRECTORS AND WHO SHOULD BE COMPANY SECRETARY

1. The online filling system for this pack requires you to register the company which is going to be the corporate trustee before purchasing the pack. In this way you can insert the ACN (the Australian Company Number) on the forms. There are instructions how to register the company as you proceed with the online filling system.


2. When registering the company you will need to identify the directors and company secretary of the corporate trustee and these notes are intended to help you to decide who these people should be. Basically all members of the fund must become directors of the corporate trustee provided they are of full legal capacity and not disqualified (for example undischarged bankrupts or those recently convicted of a serious offence of dishonesty).


3. The online filler system is not suitable for members who need representation (because for example they are children or not able to manage their own affairs). Please contact me before purchasing the pack if this applies to your fund. If any member is disqualified from becoming a director of a company then I would not advise purchasing this pack at all.


4. If there is only one member of your fund then it will already have a second trustee (because this is required for individual trustees). The member of the fund must become a director of the corporate trustee and must also be company secretary. The second trustee can become a second director of the corporate trustee if you wish, but this is optional. If there is a second director who is not a member of the fund, that second director may not be the employer of the member of the fund unless they are related (which includes spouses).


5. If there is more than one member of the fund then they will all be directors and one of them should also become company secretary. You need to decide now who is to take this role. It will be the person who is taking the lead with the paperwork. The company secretary would have responsibility to ensure that all the appropriate documents are lodged in a timely manner with ASIC. The appointee can easily be changed later.


6. Each director is also going to be a member of the company (a shareholder), and this is done automatically in the company registration process.


7. The company constitution provides that a managing director cannot be appointed, because this is inappropriate for a non-trading company (the company will be a "special purpose" company).


8. Each director is effectively a trustee of the fund using the company to act as corporate trustee. Each director/trustee will need to understand their legal obligations arising from this. There is plenty of information about this on the ATO site but the obligations also appear in the product disclosure statement, the trustee's declaration and in the trust deed.