Superannuation and SMSF

Is it time to update your SMSF trust deed?

30 June 2020
4 min read

30 June 2020

As the superannuation industry has been subject to significant legislative changes and reforms over the past 20 years, it’s important to review SMSF trust deeds every five years at a minimum.

To simplify things, we have created a chronological list of some of the key changes and their subsequent impacts, to help you decide if your current SMSF trust deed should be updated.


On 31 May 1999, binding death benefit nominations (BDBNs) were introduced. Prior to this, SMSF trustees had a discretionary power as to whether and to whom a member’s benefit is paid upon death – all deeds needed to be updated in order to allow members to submit BDBNs (which they can do now), binding the trustee to pay their benefit to nominated person(s).

2000 - 2010

The next change was on 1 July 2003 which saw the introduction of Government co-contributions to funds. Many deeds previously only contemplated employer and member contributions.

Following this, compulsory cashing rules were abolished on 10 May 2006, allowing members to accumulate indefinitely during their lives.

A range of changes came into effect on 1 July 2007 including:

  • A major reform of the superannuation system.

  • New laws and regulations enacted in early 2008 to allow persons with a ‘Terminal Medical Condition’ to access their super as a lump sum tax-free.

  • The introduction of a new account-based income stream (pension) and a new transition to retirement income stream.

The borrowing laws were amended on 24 September 2007, to allow funds to borrow on a limited recourse basis to acquire permitted assets (i.e. via instalment warrant-type arrangements). These laws were updated again on 7 July 2010 to address perceived shortcomings in the September 2007 provisions. Changes included the ability to refinance and acquire certain replacement assets.

2010 - 2020

On 1 July 2011, we saw changes to total and permanent disability (TPD) insurance meaning premiums are now only deductible for TPD insurance to the extent that the policy will pay out if the person is unable to work in any occupation (and not just their own occupation).

On 1 July 2012 a new 15 percent tax was imposed on certain concessional contributions for members with income exceeding $300,000 pa. The member can request the fund release money to pay this tax.

It became mandatory on 1 July 2013 for trustees to undertake an annual review (at a minimum) of their investment strategies and consider whether insurance in respect of their members could be affected.

Changes to insurance cover on 1 July 2014 meant that insured benefits are generally only eligible to be paid on satisfaction of a valid condition of release.

1 July 2016 marked the end of transitional relief for collectables. Strict rules now apply for all SMSFs that wish to hold collectable assets such as artwork.

Multiple changes were introduced on 1 July 2017:

  • It was announced that anti-detriment deductions would be phased out. Greater tax planning would be required to address any possible CGT implications upon death.

  • The definition of pension was changed and expanded powers are now necessary to comply with the definition of an account-based pension.

  • There were significant tax reforms. New ‘transfer balance cap’ and ‘transfer balance account’ rules were introduced, constituting the most significant changes to superannuation in a decade. These had a huge impact on pension strategies, contribution strategies as well as succession planning.

Lastly, before the lodgement date for the 2017 annual return, a CGT relief was put in place. SMSFs require flexibility to make elections or any tax choices, including for CGT relief introduced to mitigate the impact of tax reforms (mentioned above).

If you feel you may need to update your SMSF trust deed or if you have further questions, get in contact with the Findex SMSF team today or speak with your adviser.

For more SMSF and superannuation information, take a look at these videos.

A refresh on COVID-19 measures for superannuation

Understanding property investment through SMSFs

SMSF webinar | Year-end tax planning

SMSF webinar | Estate planning