Regular reviews and safekeeping of documents vital: expert
Keeping track of all documents relating to an SMSF trust deed is important if an estate planning issue arises, says an industry expert.
.
Scott Hay-Bartlem, partner at Cooper Grace Ward Lawyers and board member of the SMSFA, said being able to physically produce documents, including trust deeds, reversionary pension information, death benefit documents, and even living wills, need to be kept safe and secure, but also be ready at hand when needed.
“They're not testamentary documents, but they are like wills and we need to treat them seriously to be able to find them and have them there,” he said.
“The trust deed is probably the most obvious document and it's the starting point that most people will think about and will be focused on but that's not the only important document that needs to be kept in a safe place, and re-read.”
Pension documents are another important document that is needed in an SMSF, he said, and most people are not familiar with what it is.
“One of the problems with pension documents is that if you are dealing with an old one and if you have a defined pension still going and you claim it is reversionary, you’re going to have to find the original pension documents,” he said.
“How many of us can find documents from the ‘90s? If you’re trying to prove your pension is reversionary, without your documents that have the reversion in them, you may be in trouble.”
He added other SMSF documents are important and it is ideal to do a regular audit of all documentation to ensure they have been signed properly and still meet the needs of the members of the fund.
“In the case of things like trust deeds, it's easy to see that we have the director sign or a principle employer sign who has to sign, but when you're looking at things like resolutions, if we've got a resolution accepting a binding death benefit nomination, that's got to be accepted by the trustee,” he said.
“But we see all the time where the resolutions and the minutes don’t reflect trusteeship – does it actually work? In court cases, you have to be able to hold these up and make sure everything is consistent.”
Mr Hay-Bartlem said some obvious documents need to be reviewed and audited regularly including things like trustee variations and pension documents, but these are often overlooked.
“Binding death nominations is another obvious one. Another one that I am finding is catching people out is the annual trustee resolution,” he said.
“Do you read them? Do you think it is correct? Is it the same one you used last year? Is it the same on all files? These questions need to be asked and answered.”
Keeli Cambourne
29 February 2024
smsfadviser.com
Hot Issues
- ATO encourages trustees to use voluntary disclosure service
- Beware of terminal illness payout time frame
- Capital losses can help reduce NALI
- Investment and economic outlook, August 2024
- What the Reserve Bank’s rates stance means for property borrowers
- How investing regularly can propel your returns
- Super sector in ASIC’s sights
- Most Popular Operating Systems 1999 - 2022
- Our investment and economic outlook, July 2024
- Striking a balance in the new financial year
- The five reasons why the $A is likely to rise further - if recession is avoided
- What super fund members should know when comparing returns
- Insurance inside super has tax advantages
- It’s never too early to start talking about aged care with clients
- Capacity doubts now more common
- Most Gold Medals in Summer Olympic Games (1896-2024)
- SMSF assets reach record levels amid share market rally
- Many Australians have a fear of running out
- How to get into the retirement comfort zone
- NALE bill passed by parliament
- Compliance focus impacts wind-ups
- LRBA interest rates increase for 2025
- Income-free areas set to increase from 1 July
- Most Spoken Languages in the World
- Middle-to-higher incomes boosting SMSF growth
- Investment and economic outlook, May 2024
- Transitioning into retirement: What you should know
- Plan now to take advantage of stage 3 tax cuts
- Deeming freeze a win for Age Pensioners
Article archive
- April - June 2024
- January - March 2024
- October - December 2023
- July - September 2023
- April - June 2023
- January - March 2023
- October - December 2022
- July - September 2022
- April - June 2022
- January - March 2022
- October - December 2021
- July - September 2021
- April - June 2021
- January - March 2021
- October - December 2020
- July - September 2020
- April - June 2020
- January - March 2020
- October - December 2019
- July - September 2019
- April - June 2019
- January - March 2019
- October - December 2018
- July - September 2018
- April - June 2018
- January - March 2018
- October - December 2017
- July - September 2017
- April - June 2017
- January - March 2017
- October - December 2016
- July - September 2016
- April - June 2016
- January - March 2016
- October - December 2015
- July - September 2015
- April - June 2015
- January - March 2015
- October - December 2014
January - March 2024 archive
- Illegal access nets $637 million
- Trustee decisions are at their own discretion: expert
- Regular reviews and safekeeping of documents vital: expert
- Latest stats back up research into SMSF longevity and returns: educator
- Investment and economic outlook, February 2024
- Planning financially for a career break
- Could your SMSF do with more diversification?
- Countries producing the most solar power by gigawatt hours
- Labor tweaks stage 3 tax cuts to make room for ‘middle Australia’
- Quarterly reporting regime means communication now paramount: expert
- Plan now to take advantage of 5-year carry forward rule: expert
- Why investors are firmly focused on interest rates
- Super literacy low for cash-strapped
- Four timeless principles for investing success
- Investment and economic outlook, January 2024
- Wheat Production by Country
- Time to start planning for stage 3 tax cuts: technical manager
- Millions of Australians lose by leaving savings in default MySuper funds
- Vanguard economic and market outlook for 2024: A return to sound money
- An investment year of ups and downs
- How to tame the market's skewness
- The Countries that Export the Most Wine in the World
- Tips for preparing for the best tax outcomes