Succession Planning for your SMSF

Succession Planning for your SMSF

Succession Planning for your SMSF


When reviewing Estate Planning matters, such as your Will, Power of Attorney and Health Directives, it is important to also consider a succession plan for your SMSF.  While SMSFs often comprise a significant amount of a person’s overall assets, many people overlook this crucial step in their Estate Planning.


With the right planning, a smooth succession can be achieved with minimal family trauma and unnecessary administrative costs upon the death of a SMSF member.


Conversely, where planning is not undertaken before death, there may be uncertainty as to whom death benefits will be paid to, as well as a range of unexpected consequences.


In developing a succession plan for your SMSF, some of the key matters to be considered include:

1. Corporate Trustees V’s Individual Trustee(s)

2. A Review of the Trust Deed governing the Fund

3. Who controls the Trust after the death of a member

4. A review of the Constitution of the Trustee Company

5. Who is to receive the Death Benefits & what are the tax consequences

6. The pros & cons of Binding Death Benefits Nominations.


Clearly for a smooth transition to occur, a key element is to ensure that control of the SMSF passes into the “right hands”. Therefore a thorough review and ensuring that the correct documentation is in place prior to the demise of the member is essential.


Whilst the SMSF may only form part of the members’ overall succession planning, it is important that your Will and other Estate Planning documentation align with the way you want your superannuation benefits to be paid.


Should you need any assistance with your SMSF or Estate Planning in general, please contact your applicable ESV engagement partner on 02 9283 1666.


Article by Geoff Vince