

Corporate Trustee or Individual Trustee
Choosing the right trustee structure is one of the most important decisions when setting up a Self-Managed Super Fund (SMSF).
While SMSFs can have individual trustees or a corporate trustee, many fund members opt for a corporate trustee because of its flexibility, simplicity, and added protection.
At HelloLedger, we guide you through the process of establishing a corporate trustee, ensuring compliance with ATO regulations and helping you meet your administrative obligations.



What Is a Corporate Trustee?
A corporate trustee is a company appointed to act as the trustee of your SMSF. The members of the SMSF are directors of the company, and the company is legally responsible for managing the fund.
This structure is often recommended for SMSFs because it offers:
-
Stronger asset protection.
-
Simpler administration when adding or removing members.
-
Compliance advantages when managing ownership of fund assets.
What Are Individual Trustees?
An individual trustee structure involves appointing individuals to act as trustees of your SMSF. Each member of the SMSF must also be a trustee, and they are legally responsible for managing the fund.
This structure is often chosen for SMSFs because it offers:
-
Lower setup and ongoing costs compared to a corporate trustee.
-
Simplicity for small funds, especially those managed by families or couples.
-
Fewer compliance requirements, as there is no need to establish or maintain a company.
HelloLedger manages each of these steps, ensuring compliance and accuracy throughout the process.



Corporate Trustee Rules for SMSFs
The company (corporate trustee) is set up specifically to act as the trustee of the SMSF. All members of the SMSF must be directors of the corporate trustee.
All directors must also be members of the SMSF.
For single-member funds, the member must be the sole director or one of two directors.
Individual Trustees Rules for SMSFs
If your Fund has individual trustees it must have at least two trustees, even if there is only one member.
-
Trustees must be 18 years or older.
-
Cannot be a disqualified person (e.g., bankrupt or convicted of an offense involving dishonesty).
-
Must be mentally competent to act as a trustee.
-
Trustees must accept and sign declarations acknowledging their responsibilities under superannuation laws.
-
The sole member must be one trustee, and the second trustee can be someone who is not a member, such as a spouse, adult child, or friend.
Benefits of a Corporate Trustee
1. Improved Asset Protection
A corporate trustee provides a separate legal entity for your SMSF, reducing personal liability and offering better protection in the event of legal disputes.
2. Simplified Membership Changes
Adding or removing members is more straightforward with a corporate trustee because it only requires changes to the company’s directorship, rather than updating asset ownership records.
3. Continuity and Longevity
A company continues to exist even after the death of a director, ensuring the SMSF can continue to operate without the administrative challenges of replacing an individual trustee.
4. Compliance Advantages
Holding assets in the name of a corporate trustee simplifies compliance with the requirement to keep SMSF assets separate from personal assets.
How to Set Up a Corporate Trustee
Setting up a corporate trustee involves:
-
Registering a Proprietary Limited (Pty Ltd) company with ASIC (Australian Securities and Investments Commission).
-
Specify that the company is a special-purpose SMSF trustee to receive reduced ASIC fees. A special-purpose SMSF trustee is a company that established solely to act as a trustee and does not trade or operate as a business.
-
Appointing all SMSF members as directors of the company.
-
Comply with ASIC requirements to maintain corporate records, including minutes of meetings and changes to directors and pay an annual review fee..
At HelloLedger, we handle the registrations, documentation, and administrative setup to ensure your corporate trustee meets all ATO requirements.


Corporate Trustee FAQs
-
What’s the difference between an individual trustee and a corporate trustee?
-
-
Individual Trustees: Each member acts as a trustee, and the fund must have at least two trustees.
-
-
Corporate Trustees: A company acts as the trustee, and members are directors of the company. Corporate trustees offer simplified asset management and better compliance protection.
-
Can I switch from individual trustees to a corporate trustee later?
-
Yes, you can transition to a corporate trustee at any time. However, this process involves transferring ownership records for all SMSF assets into the company’s name. HelloLedger can assist with this transition to ensure compliance and minimal disruption.
-
Does a corporate trustee cost more to set up?
-
-
Yes, there are additional costs associated with establishing a company, including ASIC registration fees and ongoing annual fees. However, the long-term compliance benefits and administrative simplicity often outweigh the initial setup costs
-
Are corporate trustees required for SMSFs?
-
-
No, a corporate trustee is not required by law, but it is highly recommended for most SMSFs due to its flexibility, protection, and compliance advantages.
Does the corporate trustee need to lodge tax returns?
No, the corporate trustee itself does not lodge a tax return. The SMSF, as the trust, is responsible for annual tax reporting and audit requirements. HelloLedger manages all compliance and tax lodgements for the SMSF
-
Can a corporate trustee have non-member directors?
-
-
No, all directors must be members of the SMSF.
-
What happens if a director of the corporate trustee resigns or passes away?
-
-
A corporate trustee structure allows the SMSF to continue operating without transferring ownership of assets. Changes in directors can be managed easily by updating the ASIC register, ensuring the fund remains compliant.
-
What happens if a trustee dies?
-
-
The trustee’s role must be updated to reflect their removal. Also assets held in the name of the trustees must be transferred, which may involve legal and administrative costs.
-
Can individual trustees hold SMSF assets in their personal names?
-
-
No. Assets must be registered in the name of the trustees on behalf of the SMSF, for example: “John Smith and Jane Smith as trustees for Smith Family SMSF.
-
What happens if a trustee becomes disqualified?
-
-
The disqualified trustee must:
-
Be removed immediately from the SMSF.
-
The fund may need to restructure or wind up if compliance cannot be restored.