Trustee obligations

The SIS Act requires you to:

  • Act honestly
  • Exercise care, skill and diligence in managing the fund
  • Act in the best interest of all fund beneficiaries
  • Keep the money and assets of the fund separate from other assets (such as the trustees’ personal or business assets)
  • Retain control over the fund
  • Develop and implement an investment strategy and
  • Allow members access to information about the fund

In addition to these general requirements, there are specific requirements as well. You must:

1) Comply with the sole purpose test 

The ‘sole purpose test’ requires super funds to be maintained for the single purpose of providing its members with retirement benefits. There are also some other approved purposes. 

2) Have an investment strategy 

Trustees must develop, implement and regularly review an investment strategy. A written strategy document will make it much easier to demonstrate to your auditor and the ATO that you have considered the relevant investment issues.

3) Know what member contributions can be accepted 

Before you can accept a contribution from a member, you must determine their eligibility to make a contribution. Eligibility generally depends on the member’s age, their employment status and the type of contribution to be made. Trustees are required to allocate super contributions to members’ accounts within 28 days after the end of the month in which they were received.

4) Know the rules for paying benefits  

Benefits can generally be paid as a lump sum or as an income stream.

The only compulsory benefit payment is in the event of the death of a member. The payment of all other benefits is voluntary, meaning payment is at the member’s discretion subject to a ‘condition of release’ being met.

5) Properly administer your SMSF 

Trustees have several administrative responsibilities, including:

  • keeping accurate records
  • arranging an annual return for the SMSF
  • valuing assets at market value
  • advising the ATO of any changes in details