At the beginning of 2021, changes were made by the Government to the insolvency framework to better support Australian businesses, their creditors, and their employees. Amendments were made to relevant legislation to integrate this new insolvency process into existing practices following this change.
The change in this legislation includes a new category of disqualified persons, which could affect SMSFs with a corporate trustee. This new category applies when a restructuring practitioner is appointed in an insolvency event. This will trigger the disqualification of a corporate trustee of a superannuation entity, including an SMSF, from managing a superannuation entity. The amendments to include this information in the superannuation legislation received royal assent on 7 December 2021 and are applicable from the following day.
Existing funds
If your SMSF has a corporate trustee and a restructuring practitioner is appointed, the company will no longer be able to act as the corporate trustee, as it is disqualified. You need to notify us of the disqualification as soon as practicable.
New funds
If you are establishing a new SMSF, you need to consider whether the corporate trustee is eligible to act as the trustee before you appoint them.
ATO is currently working on updating ato.gov, relevant forms, and the Australian Business Register to reflect these changes.
Source: ato.gov.au/
