Setting up an SMSF and your duties as a trustee

Maximum members

Up to 6

Trustee declaration

Signed within 21 days of appointment

ATO registration

Within 60 days of the fund being legally established

Notifying changes

Within 28 days (ATO, and ASIC for a corporate trustee)

What an SMSF is and what trustees take on

The ATO describes an SMSF as a trust that exists for one reason: to provide retirement benefits to its members. Unlike a retail or industry fund, the members run it themselves as trustees, so they make the investment decisions and carry the legal responsibility for keeping the fund compliant.

That responsibility is personal. According to the ATO's overview of SMSFs, trustees can face disqualification, penalties and tax consequences if the fund breaks the rules, even where they relied on another trustee or an adviser. Each trustee is also accountable for decisions the other trustees make.

Running costs include a yearly independent audit and supervisory levy, plus help with the annual return, asset valuations and sometimes actuarial certificates. The ATO recommends advice from a licensed financial adviser on whether an SMSF suits a person's circumstances.

Members and trustee structure: individual or corporate

An SMSF can have individual trustees or a company acting as corporate trustee. The ATO page on choosing a trustee structure sets out the rules for each:

The ATO also notes that some state and territory laws limit how many trustees a trust can have, which can affect a larger fund with individual trustees. A corporate trustee is one way around this.

Every director of a corporate trustee needs a director ID before the fund is registered, and the ATO says registrations without one cannot proceed. Our director ID guide covers how to apply. ASIC charges a lower annual review fee when the company acts only as an SMSF trustee than when it also does something else, such as run a business.

Trustees and directors cannot be paid for their work as trustee of the fund.

Who can be a trustee, and the trustee declaration

The ATO page on appointing SMSF trustees says a member can be a trustee or director if they are at least 18, are not under a legal disability such as mental incapacity, and are not a disqualified person. A person is disqualified if they have ever been convicted of a dishonest offence (including spent convictions), have had a civil penalty order made against them, are an undischarged bankrupt or insolvent under administration, or have previously been disqualified by the ATO, ASIC or APRA. Knowingly acting as a trustee while disqualified is an offence.

A legal personal representative can act for a member who is under 18, has a legal disability or has died (until the death benefit is payable), and a parent can act for a member under 18. Outstanding tax affairs, such as unlodged returns or unpaid tax debts, can hold up the fund's registration.

• Written consent: every trustee or director must consent in writing to the appointment. This can be recorded in minutes and must be kept for the life of the fund plus 10 years after it winds up.
• Trustee declaration: each trustee, director or legal personal representative must sign the ATO Trustee declaration within 21 days of appointment, confirming they understand their obligations.
• Keeping the declaration: it is kept for as long as the person remains a trustee or for 10 years, whichever is longer. It is not sent to the ATO unless requested.

The Trustee declaration must be signed within 21 days of appointment and kept on file, because the ATO can ask to see it.

Setting up the fund step by step

The ATO's setting up an SMSF pages describe the order of events. The fund has to be legally established before it can be registered.

1. Choose the structure and, for a corporate trustee, register the company with ASIC after each director has a director ID. Our guide to registering a company explains that process.
2. Appoint trustees, obtain their written consents and have each one sign the Trustee declaration.
3. Check residency. To get concessional tax treatment the fund must be an Australian super fund, which broadly means it was established or holds at least one asset in Australia, its central management and control is ordinarily in Australia, and it meets the active member test.
4. Create the trust deed. The deed sets the fund's rules within the law, must state that its sole purpose is to provide retirement or death benefits, and is signed, dated and executed under the relevant state or territory law. The ATO says it should be prepared by someone competent to do so.
5. Hold assets for the fund. Once the deed, trustees and assets are in place, the fund is legally established.
6. Register with the ATO within 60 days of the fund being established, by applying for an ABN and TFN through the Australian Business Register and electing for the fund to be ATO regulated.
7. Open a bank account in the fund's name, kept only for the fund, and give the ATO the details.
8. Get an electronic service address (ESA) from an SMSF messaging provider so the fund can receive employer contributions and process rollovers under SuperStream, then record it with the ATO.
9. Prepare a written investment strategy before the fund makes any investments.

Registering with the ATO: ABN, TFN and Super Fund Lookup

According to the ATO's register your SMSF page, a fund registered later than 60 days after establishment needs a written explanation for the delay, or the application may be refused. A fund that is never registered is not ATO regulated, misses out on super tax concessions, and employers cannot claim deductions for contributions they make to it.

The application asks for the date the trust was created, a business address, an authorised contact and details of each trustee or director. The fund name must match the trust deed, and trustee details that do not match ATO records can delay or stop the registration.

Once the application is processed, the fund appears on ABN Lookup and Super Fund Lookup. Its status may first show as "Pending". Employers and other funds will not send money until the status shows "Registered", which the ATO says takes up to 56 days. A notice of compliance then issues within 7 days and the status changes to "Complying".

Most SMSFs do not need to register for GST. Under the ATO's current guidance (checked October 2026), registration is required only if annual GST turnover is more than $75,000. Contributions, interest, dividends and residential rent do not count towards GST turnover, but income from leasing commercial property or equipment does.

Ongoing trustee duties under super law

The ATO summarises trustees' obligations under the Superannuation Industry (Supervision) Act 1993 on its trustee obligations page. The main ones are:

• Act honestly and in members' best financial interests, keep control of the fund, and never allow benefits to be accessed early.
• Meet the sole purpose test. The fund must exist only to provide retirement benefits, or death benefits if a member dies first. Using fund assets personally, being paid as trustee, or buying a rental property specifically so a related party can live in it are examples of breaches.
• Follow the investment restrictions. Apart from limited exceptions, the fund generally cannot acquire assets from or lend money to members or other related parties, and cannot borrow. Investments must be made at arm's length and at market value, and fund assets must be kept separate from trustees' personal and business assets.
• Pay benefits only when a member meets a condition of release, and in line with the trust deed.
• Value assets at market value each year, prepare an operating statement and a statement of financial position, and arrange an audit by an independent, ASIC-registered SMSF auditor.
• Lodge the SMSF annual return each year, even when no tax is payable, and pay the supervisory levy with it.
• Notify the ATO within 28 days of changes to trustees, directors of the corporate trustee, members, contact details, addresses or fund status. Corporate trustees must also tell ASIC.
• Keep records: financial records and annual statements for at least 5 years, and the trust deed, minutes, investment strategy reviews, trustee changes, consents and declarations for at least 10 years.

On the supervisory levy, the ATO's annual return page, checked on 30 September 2026, lists $259 for an established fund (paid in advance for the following financial year) and $518 for a newly registered fund, covering both the year it was set up and the next. That page does not tie the amounts to a particular financial year, so it is worth checking it before lodging. Our SMSF annual audit and return guide covers the yearly cycle in more detail.

The investment strategy

Super law requires trustees to prepare, implement and regularly review a written investment strategy. The ATO's investment strategy page says there is no set format, but the strategy must be tailored to the fund and its members rather than repeating the legislation. It needs to consider risk and likely returns, diversification and the risk of too little of it, liquidity to pay expenses and benefits, and whether the fund holds life or incapacity insurance for each member.

Listing every asset class with a range of 0 to 100% is not acceptable on its own; trustees need to explain how and why they plan to invest. Where most of the fund is in one asset, such as a property bought with a limited recourse borrowing arrangement, the strategy should record that the concentration risk was considered.

The ATO expects a review at least once a year, documented for example in the annual trustee meeting minutes, and also after significant events such as a market correction, a member joining or leaving, or a pension starting. Evidence of these reviews is given to the auditor.

The ATO warns that a standard template strategy may not meet super rules unless it is tailored to the fund and reviewed regularly.

How Ross Accounting can help

Ross Accounting Pty Ltd is a registered tax agent with the Tax Practitioners Board (registration number 21430015). Through our self-managed super fund service we specialise in establishing SMSFs, can set up a corporate trustee company, and keep the fund's accounts and tax returns in order once it is running. For people weighing up contribution levels, our super contribution caps guide is a useful next read.

This guide is general information only and does not consider your personal circumstances. Whether an SMSF suits you is a financial advice question, so contact us to discuss your situation.

Frequently asked questions

General information only, not personal advice. Tax rules change and your circumstances matter, so talk to us before acting. See our disclaimer.