SMSF Specialist Advisor (SSA) Exam key terms

A trust with up to six members that is regulated by the ATO rather than APRA, where members are usually also the trustees and control investment decisions and compliance obligations.

The legal entity or individuals holding fund assets on trust for members; in an SMSF they must be members or directors of a corporate trustee, subject to limited exceptions.

A company appointed as trustee of an SMSF, with each member a director, offering administrative continuity and easier succession on death or incapacity compared with individual trustees.

The governing document establishing the fund and setting out trustee powers, member entitlements, investment rules and procedures that must be read alongside superannuation law.

The requirement that an SMSF be maintained solely for providing retirement benefits, death benefits to dependants, or benefits on terminal medical condition or permanent incapacity.

The accumulated administrative, record-keeping and reporting duties borne by trustees, including annual returns, audits, minutes and evidence supporting every investment decision.

An SMSF with one member, which must have either two individual trustees, or a corporate trustee where the member is sole director, or one trustee and one director.

The annual independent examination of a fund's financial statements and compliance with superannuation law, required before the annual return is lodged with the ATO.

A person registered with ASIC who meets the ATO's competency requirements and is independent of the fund, holding no financial interest or close relationship with trustees.

The yearly regulatory lodgment reporting fund income, contributions, member balances, assets and compliance declarations, due generally within two to three months of the financial year end.

A written document setting out the fund's investment objectives, asset allocation, diversification, liquidity and risk approach, reviewed regularly and tailored to member circumstances.

The trustee duty to consider diversification across assets and asset classes when formulating and reviewing the fund's investment strategy, weighing the fund's size and member needs.

The trustee duty to consider the fund's ability to meet cash flow needs, including pension payments, lump sums, expenses and tax, when setting the investment strategy.

The rule that fund assets and income cannot be used for purposes outside retirement provision, such as providing a pre-retirement benefit to members or their relatives.

The requirement that investments involving related parties be made and maintained on commercial terms, with documented valuations and evidence of market-equivalent dealing.

A member, trustee or their relatives, plus entities they control or influence, including companies and trusts connected to fund participants, which attract stricter investment rules.

The prohibition on a fund acquiring assets from a member or related party, subject to limited exceptions such as listed securities, business real property or certain in-specie contributions.

Land and buildings used wholly and exclusively in a business, which may generally be acquired from and leased to related parties on arm's length terms.

An asset representing a related party's interest, such as shares in a related company or units in a related trust, subject to a 5% market value cap for most funds.

A permitted gearing arrangement where the lender's recourse is limited to the asset financed, structured through a holding trust with the fund holding units.

The statutory exception allowing an SMSF to borrow to acquire a single asset or collection of identical assets, provided the lender has recourse only to that asset if default occurs.

The holding trust used in a limited recourse borrowing arrangement, holding legal title to the acquired asset while the SMSF holds beneficial entitlement through units.

A statutory ceiling on amounts that can be contributed at concessional or non-concessional rates in a financial year, with excess amounts triggering additional tax or refunds.

A contribution taxed at 15% in the fund, including employer contributions, salary sacrifice and personal contributions claimed as an income tax deduction.

A personal contribution made from after-tax money that is not claimed as a deduction and does not attract contributions tax in the fund, subject to its own cap.

A concession letting eligible members under a certain age contribute up to several years of non-concessional cap in one year, based on their total superannuation balance.

The aggregate value of a member's superannuation interests across all funds, used to test eligibility for various contribution concessions and caps.

The minimum age at which a member may access preserved superannuation benefits, subject to also meeting a condition of release such as retirement.

A triggering event, such as retirement, reaching age 65, terminal illness or permanent incapacity, that allows a member to access benefits.

Rules requiring account-based pensions to pay at least a prescribed annual percentage of the account balance, calculated on the balance at the start of the year.

An income stream paid from accumulated superannuation savings, where the member bears investment risk and the balance is drawn down over time.

An income stream available from preservation age to members still working, with limited tax concessions and restrictions on lump sum withdrawals.

The portion of fund income relating to assets supporting retirement phase pensions that is exempt from tax in the fund, calculated using an approved actuarial method.

A document from a qualified actuary certifying the proportion of fund income that is exempt current pension income where the fund has mixed accumulation and pension assets.

A lifetime limit on the total amount a member may transfer into retirement phase income streams, indexed over time and tracked through a personal transfer balance account.

The amount by which a member's retirement phase balance exceeds their personal cap, attracting additional tax and requiring removal of the excess or a commutation.

A payment made from the fund when a member dies, which may be a lump sum or pension paid to dependants or the estate according to the trust deed and nominations.

A direction from a member requiring trustees to pay death benefits to nominated dependants, valid for a limited period and subject to formal requirements.

For death benefit purposes, a spouse, de facto partner, child, or person financially dependent on or in an interdependency relationship with the deceased member.

Income from schemes where parties are not dealing at arm's length and the income exceeds what would be expected commercially, taxed at the highest marginal rate.