Increase In SMSF Membership to Six
From 1st July 2021, SMSF will be able to have up to six members.
This may suit some funds in expanding its capital base by bringing more family members into the fund with their existing balances.
This may be particularly important where family members work in the same business and are seeking to acquire business own use property.
As to whether or not this as a suitable option, fund members should consider the following:
- Does the trustee allow for additional members? This can be remedied by variation to the deed.
- Does state or territory laws allow the contemplated number of members? This can be remedied by using a corporate trustee with each member being a director and shareholder.
- Will the investment strategy need to be updated?
- Will this structure help or hinder investment rates of return
- What of family dynamics. This will be a golden opportunity for some and a commercial anchor for others.
As always, seek professional advice for your particular circumstance. At Barrett Walker we can assist you in establishing the correct legal structure or amend your exiting documents to allow for an increase in the number of members.