“In an ideal world, what makes the best deed for a client is a deed that is actually tailored to their circumstances, but obviously, out there in the market, that very rarely happens,” Jackson said.

“It’s not often a client will go to a lawyer and tell them everything that they want to have happen in terms of the fund’s focus, the running of the fund, succession plans, the payment of the death benefits, and then gets a deed made specifically for them because obviously every family situation, and every set of succession requirements are different.”

Jackson said having a tailor-made deed is also prohibitive in terms of cost and time, so in most circumstances, it is more efficient for clients to choose to proceed with an off-the-shelf deed.

“What makes a good off-the-shelf deed, in my view, is a deed that’s flexible. I think flexibility is key because we’re trying to, particularly as advisors, put clients into a trust deed that is hopefully going to be suitable for the majority of their circumstances,” he said.

“It’s not going to be perfect for everything, and that’s the nature of an off-the-shelf deed, but something that is flexible, that obviously can move with the law as the law changes, will generally be the best for clients because it means whatever investment type options they’re looking to undertake, or whatever sort of complex succession is arranged such as binary nominations or reversionary pensions, the deed will cater for that.”

He added that, generally, flexible deeds are often a little harder to read because they don’t have as much detail, and from a layperson’s point of view, they can sometimes look like a difficult document.

“There’s a lot of deeds out there that are made for the layperson, which are easy to read, but what I find is they tend to be very inflexible. Therefore, you get unusual situations where perhaps someone has lost capacity, and you need to appoint an attorney as trustee, but the deed doesn’t work properly because although it’s written in a way that makes it easy to read, it is quite restrictive,” he said.

Shelley Banton, head of technical for ASF Audits, added that when setting up an SMSF, trustees should be doing so with “the endgame in sight”.

“However, often we’re looking at vanilla-flavoured mum and dad funds that may have just listed shares and cash and don’t think they need to have anything that’s tailored to their circumstances because they believe that nothing will change,” she said.

“We need to get the message across to the industry and trustees that having flexibility in a deed is important, as is looking at what can go wrong in the parameters of your life and what’s going to happen in another 10, 20, 30, or 40 years.”