17B allows a trustee to be remunerated for a non-trustee service where they are appropriately qualified, where they’re carrying on a business to the public and it’s at arm’s length, said DBA Lawyers director Daniel Butler.

“So, they need to meet the criteria that they’re qualified, they’re carrying on a business and the payment is in accordance with arm’s length rates. In that event, you could have a trustee who is remunerated,” Mr Butler explained.

“A typical type of scenario is a trustee who is a builder and if that builder is a sole proprietor builder, in that event 17B would allow that builder to be remunerated for services in respect to improvements for that property owned by the fund.”

However, without express wording in the trust deed providing for this remuneration in line with section 17B, this could be problematic, warned Mr Figot.

“If you look at section 17B, it doesn’t actually say that the super fund can remunerate the trustee, it just says that if the trustee is remunerated in these limited circumstances, you won’t fail the definition of a super fund, but you still need the deed to positively empower the trustee to be remunerated,” he said.

“There are still a lot of deeds to this day that just don’t give that adequate power, unfortunately.”

Mr Butler also reminded SMSF professionals that in the event someone is not remunerated when they’re entitled, then they run the risk of incurring non-arm’s length income.