SMSF – Corporate Vs Individual Trustees

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Common reasons for changing to a corporate trustee.


Common reasons for changing to a Corporate Trustee include:

  1. death;
  2. marriage breakdown, or;
  3. the fund wanting to borrow to purchase property (since most of the major lenders require a fund to have a Corporate Trustee). 

In most situations it will be better for an SMSF to have a Corporate Trustee, rather than Individual Trustees. The major disadvantage of a corporate trustee is the up-front cost of establishing the company. It should be noted that the ongoing costs of having a corporate trustee are very low.

In general, the longer-term benefits of having a company outweigh the extra costs. 

The following table looks at the advantages and disadvantages of a corporate trustee over an individual trustee:

CORPORATE TRUSTEE

INDIVIDUAL TRUSTEE

Questions?

Our team of skilled financial advisors can assist in understanding the best structure for you. Contact us directly on 03 5911 7000 or find out more on trustees from the ATO website >>.



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