Separation of Assets

As a trustee it is important to ensure that all assets of your superfund are kept completely separate from your personal assets.  This not only is a legislative requirement but it will also protect the assets which are held in the fund from financial disputes, particularly in the event of relationship breakdown and against potential creditors.  By ensuring assets are kept separate removes any risk that the assets will be used for private purposes and it will be easy for the auditor of the fund to verify asset ownership.  As such the fund will require its own bank account in the name of the trustees ATF the super fund.  All income of the fund needs to be received and all payments should be made out of this account.  In addition if the fund is trading shares it will also require its own share trading account in the name of the superfund too.

It should also be noted that the assets of the SMSF (such as a property) cannot be used as collateral when borrowing money for private or business purposes.

Trustees who do not comply with the separation of asset rules face being reported to the ATO for a compliance breach which can result in substantial penalties.