Can I Add My Spouse to My SMSF Later?

Can I Add My Spouse to My SMSF Later? Yes, as a general rule a spouse can usually be added to an existing Self Managed Super Fund without an issue. The key area to check is whether your SMSF deed is up to date and allows for the admission of new members, whether the addition will not mean the SMSF exceeds the six member limit and whether your spouse is eligible to be a member. It is important to note that the step by step process below assumes that the fund is compliant, setup with a corporate trustee and has a professionally established deed allowing for the addition of members without any difficulties. In the event a client has issues with the deed then the first step will be to get your SMSF team to update the deed to the latest standard, something which we can assist you with as part of the process.

Adding a Spouse to an SMSF – Step by Step Process

Step 1: Add a member

Your SMSF accountant will prepare a member application form which the new member completes along with providing their personal information. The trustee has to accept it and send an acknowledgement to the member accepting the application. The member application may be one prescribed by the fund’s trust deed. These templates are all prepared by the SMSF administrator as part of the process.

As part of the personal information required, they will need to provide a photo ID such as a Drivers License or Australian Passport in order to pass the required Verification of Identity checks required under the Anti Money Laundering rules.

Step 2: Add a director to the corporate trustee

Corporate trustees are a type of company, specifically a special purpose company, and are regulated by ASIC. Therefore, the following is required:

review the company constitution to see if there are any company specific rules effecting the addition of a new director or transfer of shares;
your spouse must be over 18 and not disqualified from being a director, such as being an undischarged bankrupt or having been jailed for fraud or other offences;
they must have a Director Identification Number prior to being able to being appointed;
your spouse must provide written consent to be appointed as a director;
the trustee company passes a resolution appointing the director.

For all SMSF Australia clients we prepare these forms and once signed we then make the changes online by completing “Change to company details” (form 484). This is done via your ASIC Agent (usually your SMSF accountant) and forms part of the corporate registry moving forward.

Step 3: ATO trustee declaration

This is a very simple template document from the ATO which your SMSF Accountant will generally complete and provide for you to sign. Under the superannuation rules (SIS), a new director of the corporate trustee must sign the declaration within 21 days of being appointed. This document is then kept on the SMSF’s permanent file and must be provided to the SMSF Auditor as part of the permanent file however, there is no requirement to send a copy to the ATO once signed unless formally requested by the tax office.

Step 4: Consent to Act

Required under Superannuation Industry (Supervision) Act 1993, a director of a corporate trustee must agree to being appointed and confirm that they are not a disqualified person and that they understand the trust deed and governing rules. This is different to the consent to be appointed under ASIC rules.

Step 5: Trustee resolution

The trustee confirms the appointment and acceptance of the new director who is not a disqualified person.

Step 6: Change of details for superannuation entities

Update the fund details with the Australian Business Register (ABR) within 28 days to add your spouse as a new member and director of the corporate trustee. We can update our clients online as will most SMSF accountants but for DIY trustee their details can be updated by phoning the ATO on 13 10 20 or by lodging a paper form.

Step 7: Update signatories

Once the documents are all updated then you can contact the funds banker, investment adviser, exchanges etc to add the new member as a signatory on the accounts.

Step 8: Investment strategy

Review and update the fund’s investment strategy and have all directors sign, including the new director. This can be as easy as re-signing the existing investment strategy without making any changes or starting again with a new SMSF Investment Strategy depending on your unique circumstances. We provide free templates to all of our clients to help them to ensure their strategy is compliant with the rules and easily passes the annual audit. It is especially important where spouses have a considerable age gap to decide whether they share similar retirement objectives, insurance needs or liquidity concerns.

Step 9: Review Binding Death Benefit Nominations

Once added as a member the spouse should consider whether they want to complete a Binding Death Benefit Nomination as part of their SMSF Estate Planning.

FAQ on Adding Spouses

Will my spouse get half the fund?

No, the SMSF members allocations are split based on how much each member has in the fund. For example, if you currently have $400,000 of assets in a fund and a new member joins and rolls $100,000 of their super into the SMSF then their ownership would be 20% calculated as their $100,000 divided by the $500,000 total member balance.

How do I remove my ex-wife from my SMSF so I can appoint my new partner to my SMSF?

Separation or divorce does not automatically remove a former spouse from an SMSF and is not a process the remaining spouse can force. The parties must first determine how the SMSF assets will be dealt with under their legally binding agreement or court order. There are a lot of different options which vary considerably, so the fund’s accountant and family lawyer should coordinate the implementation.

Generally, once the legal aspects are sorted the step by step process includes:

Roll over your ex-wife’s super balance to her preferred complying super fund such as an industry fund or a new Self Managed Super Fund.
A trustee resolution is passed accepting the member’s rollover, member exit, and resignation as a director of the corporate trustee.
She resigns as a director of the corporate trustee in writing, and the resignation is accepted in accordance with the company’s constitution.
A share transfer form and a director’s resolution approving the transfer are completed.
An ASIC Form 484 is completed and lodged with ASIC, recording her removal as a director and the transfer of her shares
Complete a “change of details for superannuation entities”, removing her as a member and director of the corporate trustee
Remove her as a signatory on the fund’s bank account and any other investment accounts

Can I change the Name of my SMSF?

Often when a new member joins they like the idea of their name forming part of the Self Managed Super Fund as well, especially if it is a fund previously owned with a members former spouse. The short answer is yes, you can change the name of your super fund via a Deed of Variation and the name of the corporate trustee via an ASIC form however, we don’t recommend it from a cost perspective.

The name is purely cosmetic, so it is rarely worth the cost of changing it over and the administrative time involved. That being said, if a trustee chooses to do so for personal reasons we can certainly assist with the process. Note that the costs involved around $1,400+GST including the ASIC change of name fee for the corporate trustee of $524, the legal fees for the Deed of Variation and then the time to update ASIC, ATO, ABR etc.