SMSFs and small APRA funds can have up to 6 members from 1 July 2021 following legislative amendments. On Friday 13.8.21, the ATO uploaded a post, noting that the Australian Business Register (ABR) has been updated to enable SMSFs to add a fifth or sixth member instead of using their interim process.
See below for further detail.
The law was changed recently, to allow Self Managed Superannuation Funds to have up to 6 Members, with effect from 1 July 2021. This was under the Treasury Laws Amendment (Self Managed Superannuation Funds) Bill 2020 (Amending Act) which received Royal Assent on 22.6.2021 as Act No.47 of 2021.
The Australian Business Register (ABR) has now been updated and you are now able to add a fifth or sixth member to your self-managed superannuation fund (SMSF) instead of using our interim process.
This follows legislation that came into effect on 1 July that allows you to have up to six members in your SMSF.
Before you create a fund, or add additional members, it is important to remember that some State and Territory laws restrict the number of trustees a trust can have to less than six. This is because an SMSF has to either have all members as trustees, or a company will all members as directors (s17A(1)(b) or (c) of SIS Act).
As an SMSF is a type of trust, it is important that you seek professional advice to help understand if your SMSF is impacted by these restrictions. And the advice might be, for instance, you’ve got to have a corporate trustee, where the number of directors can be 6.
The increase in the maximum number of members in a SMSF also has flow on effects for other requirements, such as signing financial statements. The accounts and statements (an operating statement and a statement of financial position) of an SMSF must be signed by the required number of trustees or directors of the corporate trustee. This number will depend on the number of trustees or directors of the corporate trustee that your SMSF has. For the 2021–22 and later financial years, if there are:
- One or two directors or individual trustees, then all of them must sign the documents
- Three or more directors or individual trustees, then at least half of them must sign the documents.
[ATO website: Maximum of 6 Members; LTN 155, 13/8/21]