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Have you appointed an enduring power of attorney?

Whomever you choose, it is essential they fully understand their responsibilities as a trustee of an SMSF.



Every trustee should appoint an enduring power of attorney, so that if you do suffer a serious accident or illness and you can no longer look after your affairs, someone you trust can look after them for you. 

If you haven’t already got an enduring power of attorney, contact your solicitor who can provide advice about how to appoint one.

SMSF issues explained


Generally, self-managed super funds (SMSFs) use an enduring power of attorney in two main circumstances.

In the first instance, someone who has been appointed as an enduring power of attorney by an SMSF member may be required to step in as trustee if the member suffers an accident or illness and is no longer capable themselves of being a trustee.

The enduring power of attorney will become a trustee of the fund, and acts in the interests of the fund member.

In this context, the person who is appointed to be an enduring power of attorney might need to manage any disability benefit to which the member is entitled, and which may be administered through the SMSF. 

What’s important to remember is that laws around enduring powers of attorney are state-based. Each state has its own way of activating an enduring power of attorney so it’s important for SMSF trustees to ensure they area aware of, and stay within, each state’s rules around this.

This is critical because an enduring power of attorney must be activated for the person who is nominated to become a trustee of the fund. The trustee then acts on behalf of all members. If the enduring power of attorney is not activated they won’t be able to do that.

This applies equally to individual trustees and to funds that use a corporate trustee.

Going abroad


In another set of circumstances, an SMSF member might appoint an enduring power of attorney if the member is going overseas for a period, say three to five years.

In this situation the fund members will nominate an enduring power of attorney while they are away to manage the SMSF and its assets on a temporary basis.

Often in these cases, the enduring power of attorney won’t be given universal powers over the fund members’ entire financial affairs. This would give them the ability to transact their other assets, for instance, to buy and sell their home. So the enduring power of attorney might be limited to looking after the member’s financial assets including superannuation.

If the fund members are overseas, it’s important that the person who is appointed to be the enduring power of attorney is based in Australia. This will allow the fund to comply with the rules governing the superannuation system and take advantage of the favourable tax rules the system offers.

While the members are overseas, it’s essential for the fund to remain an Australian super fund for the members to be able to continue to retain the Australian tax concessions.

When members are overseas, it’s sometimes the case that they will give one or more of their trusted children the ability to act under an enduring power of attorney and run their fund.

While in some circumstances it may be considered appropriate to choose a professional adviser such as an accountant, solicitor or financial planner, there may be a conflict between holding an enduring power of attorney and providing the professional advice to the fund. 

Whomever you choose, it is essential they fully understand their responsibilities as a trustee of an SMSF.

Above all, ensure your enduring power of attorney complies with your state laws so that in the event you cannot manage your own affairs or go overseas for a period, you have confidence someone you trust will have the authority to step in to act as a trustee of your SMSF.

Remember, appointing an enduring power of attorney is an important decision. Choose someone who you trust to genuinely act in your best interests.  
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