Thank you

Hi Shalendra

Normally the EPOA allows the member who is overseas to be replaced as director of the Trustee company. That is the member is no longer a director of the trustee company.

As I noted above the residency rules are complicated and you need to go through all the circumstances.

If there is any doubt the Fund could apply for a private binding ruling from the ATO as to whether the Fund has complied with the residency rules.

Thanks

SMSF AAA

Hi Shalendra

I cannot comment if all correctly done as do not have all the details / documents.

SMSF & residency is complicated. A SMSF where a member is to be based overseas can appoint an Australian based person as trustee in their place via an Enduring Power of Attorney (EPOA). By replacing the trustee with an Australian based trustee this allows the Fund to continue to meet the central management and control requirement. This would normally only apply for the period that they are based outside of Australia.

The SMSF residency rules are:

1. Fund established in Australia.

2. Central management and control is in Australia.

3. Fund has no active members or active members who are Australian residents have Fund assets at least 50% or greater.

Refer Tax Ruling 2008/9 - Income tax: meaning of 'Australian superannuation fund' in subsection 295-95(2) of the Income Tax Assessment Act 1997

https://www.ato.gov.au/law/view/document?DocID=TXR/TR20089/NAT/ATO/00001&PiT=99991231235958

Refer also:

www.ato.gov.au

To be a complying super fund and receive tax concessions, your SMSF needs to be a resident regulated super fund at all times during the financial year.

In the May 2021 budget the government proposed changes to the SMSF residency rules from 1 July 2022.

Thanks

SMSF AAA