How to set up an SMSF: Understanding SMSF trustee structures

When you start a self-managed super fund (SMSF), you’re stepping into the driver’s seat of your retirement savings. You’ll decide how your fund is run, what it invests in, and how it grows over time.  

One of the most important choices you’ll make from day one is who will act as the SMSF trustee. This decision affects how your fund operates, how easy it is to manage, and how well it adapts to life changes in the years ahead. 

The trustee decision — two structures to choose from 

Every SMSF must have a trustee, who is the legal “owner” of the fund’s assets and the person or entity responsible for compliance. Your options are: 

1. Individual trustees: Each member personally acts as a trustee. 

2. Corporate trustee: A company acts as the trustee, and each member is a director of that company. 

Why many SMSFs choose a corporate trustee 

1. Smoother changes when life moves on 

Over the life of your SMSF, members may join or leave due to marriage, divorce, adult children joining, or the passing of a member. 

2. Running a single-member fund 

3. Protecting your personal assets

4. Lower penalties if something goes wrong

The ATO can impose administrative penalties for breaches.  

5. Stronger estate and succession planning 

Companies don’t “die”. A corporate trustee continues even if a member passes away or loses capacity, making it easier to pass control smoothly to the next generation. 

6. Clearer separation of assets 

Super law requires SMSF assets to be kept separate from personal or business assets. A dedicated corporate trustee makes this distinction obvious, keeping your records clean and your auditors happy. 

7. Lender-friendly 

If you plan to borrow money in your SMSF, for example to buy property using a Limited Recourse Borrowing Arrangement (LRBA), most lenders will require the SMSF to have corporate trustees.  

8. The cost consideration 

A corporate trustee does involve: 

• An initial set-up fee for the company. 

• An annual ASIC fee (reduced for “special purpose” SMSF companies). 

However, these costs are often outweighed by: 

• Avoiding repeated title changes when members change. 

• Reduced personal legal and compliance risks. 

• A structure that lasts as long as your fund does. 

Why people choose a sole purpose corporate trustee 

A sole purpose corporate trustee is a company created solely to act as the trustee for your SMSF. It will: 

• Keep your SMSF separate from other legal or business matters. 

• Simplify record-keeping and compliance. 

• Avoid conflicts with unrelated company or trust rules. 

The bottom line 

Your trustee structure is one of the most important foundation decisions you’ll make for your SMSF. While both options are legal, a corporate trustee (especially one set up solely for your SMSF) can make your fund easier to run, more adaptable to change, and better protected for the long haul. 

If you’re setting up your SMSF from scratch, getting the trustee decision right from the start can save you time, money, and stress later on. Combine this with the right “why,” a strong investment strategy, and a clear plan for costs and compliance, and you’ll be well on your way to a super fund that truly works for you. 

This document contains general information and does not constitute legal or taxation advice. If you need legal or taxation advice, we recommend you speak to a qualified advisor.