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The SIS Act sets out conditions a fund must satisfy to be an SMSF. A member who has an enduring power of attorney in place ensures:
There are some points to note about the power of attorney:
The replacement process is not automatic. The incapacitated member must be removed as trustee and the legal personal representative appointed as trustee or director of the trustee, all in accordance with the relevant legislation and the governing rules of the entity (SMSF trust deed or company constitution).
The legislation provides for a 6 month period to get the fund in order. This means the replacement must be appointed within 6 months of the incapacity, unless the member regains capacity within that period and can resume their duties.
For more information, read Self Managed Superannuation Funds Ruling 2010/2.
You can read earlier ClearLaw articles on a range of SMSF and estate planning topics.
Qualifications: LLB (Hons), BEc (Hons), Monash University
Leigh is a Partner in Maddocks Tax and Structuring team. Leigh has extensive experience in advising Australian and multinational companies, high net worth individuals, accountants and financial advisers on all areas of taxation law.
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His advice covers both direct and indirect tax considerations.
Throughout his career, Leigh has been at the forefront in developing tax-effective corporate, trust and superannuation structures.
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