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  1. Edward

     /  March 9, 2015

    Hi Liam,

    My wife and I were individual trustees before changing to a corporate trustee in late 2012. From memory, the ASIC fee in establishing the company was approximately $430 or so (the fee today is $457 according to the ASIC website).

    However, when I see the establishment of a corporate trustee by SMSF administrators and the like, I have seen quotes from $600 all the way up to $1,100, so for the sake of a bit of time, completing a form and dealing directly with ASIC, an engaged trustee can save anything up to $600-$700. If you need help with the form, one needs to just get on the phone to ASIC and be talked through it … just put the phone on speaker and do something else whilst you wait.

    It’s much preferable that anyone contemplating a new SMSF starts with a corporate trustee with each member being a director. In our case, we had seven investments in listed securities so we had to pay our broker an off-market transfer fee of about $54 or so per security. With us fully understanding the benefits of a corporate trustee though, this was not a concern and we promptly paid it to ensure that legal title of the shares was changed from individual trustees to that of the corporate trustee. It’s important to note that whilst there’s a change in legal ownership, there’s no change in beneficial ownership and hence no CGT is applicable.

    Of course, because we had a relatively small number of listed securities in the name of the fund where we had individual trustees, we declined to make any further investments until this change to a corporate trustee was completed. The obvious benefit is that if either my wife or I were to die, there doesn’t have to wholesale changes to the legal name of each investment simply because a trustee is removed and replaced with another individual (or a company).

    Anyway, for us, it was well worth the time and the train ride into town to have the company established by ASIC in person. For those people outside of a capital city, it’s merely a matter of sending the form into ASIC with your cheque and waiting for the certificate to be mailed back to you. As well as the fund’s broker and the ATO, it’s also important to make the change with the fund’s bank so open a new account in the name of the corporate trustee ATF the fund.

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  2. Edward

     /  March 8, 2015

    Not only is the discount good, but one also postpones the regular annual increase in the annual fee for ten years. There’s no doubt at all having a corporate trustee with payments in advance every ten years is the way to go.

    Something else I’m quite bemused by too is the set up cost for the special purpose company. I’ve not read it anywhere that a trustee can contact ASIC directly, fill out the paperwork and pay the fee, without the extra cost imposed by an adviser. Why pay up to $850 when a self-directed person can get away with paying the ASIC fee only? This is what I did:

    1) I phoned ASIC for guidance on where to find the appropriate form on their website (caution though, much patience is needed getting through on the phone),

    2) I completed the form and walked into the local ASIC office in my capital city (if one doesn’t live in a capital city, they can simply mail the form with a cheque for payment), and

    3) I have the ASIC staff member print out the certificate for my newly registered special-purpose company on the spot (with all members of the fund listed as a director), however if you’ve mailed your payment and form, then you would need to wait for this to be mailed to you,

    4) My wife and I complete the ‘Change of details for superannuation entities’ form and mail it back to the ATO to register the change from individual trustees to a corporate trusted.

    Yes, there’s a little work involved, but it’s not difficult to avoid additional adviser fees if you really want to. An ASIC key and login is provided too so you can check your details online at any time.

    Just my thoughts Liam. Regards.

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    • Hi Edward

      Great tip. Can you advise the actual costs incurred so people can see the saving. I always recommend people do what they can to save fees especially if they have the time.It improves their knowledge of the superannuation system and confidence in the strategies they are using.

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