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The regulator said if a trustee chooses to establish an SMSF with individual trustees the fund can have up to six members, each of which must be not just a trustee but a member of the fund. Additionally, members cannot be an employee of another member unless they are relatives.

It continued that some state and territory laws restrict the number of trustees a trust can have to less than six and as an SMSF is a type of trust, it is best to consider seeking professional advice to check if the fund is affected. If it is, the SMSF can be restructured with a corporate trustee.

If an SMSF is to be established under a corporate trustee structure, the tax office said each member of the fund must be a director of the corporate trustee. For a single-member fund, the member can be either the sole director of the corporate trustee, or one of two directors of the corporate trustee provided either the member and other director are relatives or the member is not an employee of the other director.

Directors of corporate trustees must have a director identification number (director ID), which is a unique identifier that a director will apply for once and keep forever.

The establishment costs of an SMSF can be paid for either by the fund or the trustee. If it is paid for personally, regulation 5.02 of the Superannuation Industry (Supervision) Regulations 1994 allows the fund to charge those costs against the trustee’s super benefits which they can claim reimbursement for from the fund.

This should be done as soon as the fund has available cash. SMSFR 2009/2 Self Managed Superannuation Funds: the meaning of ‘borrow money’ or ‘maintain an existing borrowing of money’ for the purposes of section 67 of the Superannuation Industry (Supervision) Act 1993 confirms that where expenses are paid on behalf of the SMSF and reimbursement is immediately sought from and made by the SMSF the arrangement is not considered a borrowing.

Moreover, the ATO states, the reimbursement also does not count as financial assistance and the fund does not treat the reimbursement as a contribution because its capital does not increase when it repays an establishment cost paid on its behalf.

If reimbursement is not sought, the establishment costs must be treated as a contribution as establishment costs represent capital expenses, and the fund can’t claim a deduction for these fees.

If the fund is established with a corporate trustee, the trustee(s) will have to pay Australian Securities & Investments Commission fees, an initial fee to register a corporate trustee for the first time and an annual review fee, which is lower if the corporate trustee acts solely as a super fund trustee, but higher if the corporate trustee also performs another function, such as running a business.

Individual trustees and directors of the corporate trustee cannot be paid for their duties or services performed as trustee in relation to the SMSF.

Once the fund has been established, the ATO emphasised the individual trustees and directors of the corporate trustee must follow the rules in both the SMSF trust deed and the tax and super laws.

In addition, directors of the corporate trustee must follow the rules in the company’s constitution and the Corporations Act 2001.Directors of a corporate trustee must obtain a director ID before registering the fund.

If a fund identified with a corporate trustee structure does not have a director ID the establishment will be unable to proceed and penalties may be imposed by ASIC if directors don’t have a director ID.

In regard to the ownership of SMSF assets, the ATO states that fund assets must be kept separate from the personal assets of trustees and directors, and in the name of the fund or the name of the individual trustees ‘as trustees for’ the fund.

If an SMSF has individual trustees, when a trustee is added or removed, the name in each asset’s ownership document must be updated. This can be costly and time-consuming. State government authorities and financial institutions may charge a fee for title changes.

If an SMSF has a corporate trustee, when a person starts or stops being a member, they become, or cease to be, a director of the corporate trustee and ASIC must be notified of any change in director.

SMSFs with individual trustees must always have at least two trustees. If one trustee leaves or dies, the other must either appoint another trustee, change to a corporate trustee structure or wind up the fund. The ATO must be notified within 28 days of the appointment of another individual trustee.

Funds with a corporate trustee can operate with one director. The corporate trustee does not change if a director leaves or dies. However, if the directors change, the trustee needs to notify both the ATO and ASIC within 28 days.

Keeli Cambourne
February 23, 2026
smsfadviser.com