SMSF Update: Public Trustee Nominee Rules Explained

New legislation may soon change how self-managed super funds (SMSFs) handle trustee arrangements in certain situations. The Treasury Laws Amendment (Delivering an Efficient and Trusted Tax System) Bill 2026 proposes updates to the Superannuation Industry (Supervision) Act 1993 (SIS Act), giving SMSFs more flexibility when members are unable to act.

What’s changing?

The proposed law allows a nominee approved by the Public Trustee to act as a trustee of an SMSF, or as a director of a corporate trustee. This is particularly relevant where a member cannot fulfil their trustee duties.

The nominee does not need to be an employee of the Public Trustee, but must be appropriately qualified and hold any required licences.

When can a nominee be appointed?

A Public Trustee-approved nominee can step in under three key scenarios:

• When a member has passed away and the Public Trustee manages the estate
• When a member lacks legal capacity and the Public Trustee is appointed to manage their financial affairs
• When the Public Trustee acts under an enduring power of attorney

These changes are designed to help SMSFs continue operating without breaching trustee rules.

Can the nominee be paid?

Yes. A key feature of the proposal is that the nominee can be remunerated for acting as a trustee or director, provided the fees are reasonable. This is a shift from current SMSF rules, which generally prohibit trustees from being paid for their trustee duties.

Is appointment mandatory?

No. The rules do not require SMSFs to appoint a nominee. However, in practice, it may be necessary in certain cases (such as incapacity) to maintain the fund’s compliance status.

Who appoints the nominee?

The Public Trustee approves the individual, but the actual appointment must be made in line with the SMSF’s trust deed or governing rules. The nominee must also meet standard eligibility requirements, including providing written consent and not being a disqualified person.

Why this matters

SMSFs must meet strict trustee structure requirements to remain compliant. These proposed changes provide a practical solution when members can no longer act, without forcing the fund to restructure or risk losing its SMSF status.

Need help?

If your SMSF may be affected by these changes, now is a good time to review your trust deed and governance structure.

Contact iCare Super if you need assistance navigating these new rules or managing your SMSF compliance.