A Self Managed Superannuation Fund may choose from the alternatives, as shown below, when deciding on trusteeship:

  • Individuals (up to four members)
  • Corporate trustee

It is sometimes difficult to figure out which option is best in your personal circumstances. The key differences are listed below along with a brief analysis of the advantages and disadvantages of each further on.

  • Cost
  • Separation of assets
  • Trustee/Director & member requirements
  • Asset ownership
  • Penalties
  • Succession planning


The administration costs associated with the establishment & ongoing trusteeship are cheaper where individuals have been appointed. In the case where a SMSF trustee is incorporated with the sole purposes of acting as trustee for the SMSF there is a reduction in the ongoing ASIC costs. The final option for an SMSF trustee is a dual purpose trustee, where a company acts both as trustee for the SMSF as well as another trust. In this case the company will not be entitled to the reduced ASIC fees.

Separation of assets

Where a sole purpose trustee has been appointed this makes the split of SMSF assets clear. Where individual trustees have been appointed assets of the SMSF and become “mixed up” with personal assets. This can create an additional layer of complexity.

Trustee/Director & member requirements

Basically, all members of a SMSF must be a trustee, or director of the trustee company of the fund. The only exception to this is for a one member fund with an individual trustee. A SMSF is required to have at least two individual trustees, one NOT being an employee of the other unless those individuals are related. Again, a sole purpose trustee is often best practice in order to comply with the requirement of all members being directors.

Asset Ownership

Where individual trustees have been appointed, where one member leaves the fund all titles of assets held by the fund will be required to be updated. This can be both costly & time consuming. If a corporate trustee has been appointed and an individual ceases to be a member of a SMSF, they simply also cease to be a director of a trustee company.


Under Superannuation laws penalties are applied per trustee. In these circumstances a corporate trustee is deeded to be one trustee, where as in the case of four individual trustees the penalty could potentially be applied four times.

Succession planning

A corporate trustee can continue after the death of a member with the appointment of new directors and/or members whereas this is unlikely where trustees are individuals.