To declare a trust relationship between the asset and trustees of a self managed superannuation fund two documents can be executed.The documents are similar but you should consider your circumstances and which document you need to execute.
Declaration of Trust
- This is used where the trustees intends to acquire the property for and on behalf of SMSF on a future date. A declaration of trust clearly establishes the relationship between legal owners and beneficial (real) owners of the asset.
- Legal owners act merely as trustee for and on behalf of the beneficial (real) owners.
- This document is executed before the purchase is made.
Acknowledgement of Trust
- Acknowledgement of trust is used where the trustees have already acquired (in the past) an asset and are currently holding the asset for and on behalf of the SMSF.
- This document assumes that the Trustees have not executed a Declaration of Trust and the asset is already registered in their name.
- Acknowledgement of Trust is a document to acknowledge a trust relationship between the fund and trustees and to affirm that the trustees are holding the asset for the benefit of the self managed super fund from the date of purchase.
REMEMBER, the above are issues that auditors focus on when it comes to the audit of a SMSF. Our audits for funds start from $300 and follow a comprehensive audit plan.
DISCLAIMER: The above is general advice only, you should not act on this advice without consulting a professional adviser to discuss your personal circumstances.