Succession planning for SMSF trustees

Succession planning for SMSF trustees


A responsibility that does not immediately spring to mind when managing a self-managed super fund is working out what will happen if a member becomes incapacitated and unable to perform their trustee duties.

Succession planning for an SMSF can become quite complicated if not managed on an ongoing basis. It not only requires having a plan; trustees also must stay in touch with Australian superannuation rules as time passes.

Finding a replacement trustee can be difficult, and since appointing a replacement trustee, whether as an individual trustee or director of a corporate trustee, gives that person control over the super fund’s assets; particularly its investments and bank accounts, trustees should choose wisely.

Some may opt to appoint an enduring power of attorney (EPoA) as a replacement trustee. An EPoA is someone who is appointed to look after a member’s interests if they can’t do it themselves and can assume the member’s responsibilities (if that is how the fund is structured).

However, for an EPoA nominee to be appointed, legal documents i.e. the succession documents appointing the replacement director must be in place before the member loses their capacity to be a member.

A common misconception surrounding SMSFs is that a trustee’s legal personal representative (LPR) who is appointed under an EPoA can immediately assume the role of trustee of a self-managed super fund.

This is not entirely true, and ultimately depends on the provisions of the fund’s trust deed and whether there are appropriate legal documents in place to make this happen.

Essentially, a fund’s trust deed and corporate trustee company constitution should include the ability to easily appoint a successor trustee or director who assume the role of a member, should that member lose the capacity to perform their trustee duties.

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If you believe the matters discussed above are relevant to your business, please contact Darren Smith of our office to discuss further.


Darren is a Chartered Accountant with extensive experience, including working in the big 4 and medium sized firms before becoming a partner of a city based firm in 2000.

He has gained much experience and has extensive knowledge in providing business and taxation advice, superannuation planning, negotiation of sales and acquisitions of businesses and property development. His client base covers a wide range of industry groups.

Darren works with business owners to grow their businesses and create personal wealth within and outside of their business.


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