Special purpose companies: SMSF trustees, NFPs, and more

A special purpose company is a company that qualifies, under regulation 3 of the Corporations (Review Fees) Regulations 2003, for a reduced ASIC annual review fee. For 2026–27 the reduced rate is $70 a year where the company is a proprietary company, or $65 where it is not, against $342 for an ordinary proprietary company and $1,591 for a public company. Over the life of an entity, and across a group holding several qualifying companies, the difference is material. But the concession is narrower than it is usually described, and the common assumption about it is wrong.

The assumption is that a company qualifies because it is a trustee. It does not. Acting as trustee of a family discretionary trust or a unit trust does not make a company a special purpose company, and a trustee company of that kind pays the full $342. Qualification is defined by a closed list in the regulation, and a company outside that list is an ordinary company for fee purposes however narrow its actual activities are.

The category that matters most in practice is the superannuation trustee company. A company qualifies where its constitution prohibits distributing the company’s income or property to its members and its sole purpose is to act as trustee of a regulated superannuation fund within the meaning of section 19 of the SIS Act. This is the category SMSF corporate trustees fall into, and it is the one most CoSec clients rely on.

The remaining categories are narrower and largely historical. A home unit company qualifies where it is a proprietary company that owns land on which a building divided into separate residential areas and common areas is erected, its members are entitled by virtue of their shares to exclusive occupation of one or more of those residential areas, and the company operates only to facilitate and enforce those occupation rights and maintain the common areas. A charitable company qualifies where its constitution requires it to pursue charitable purposes only and apply its income to promoting them, prohibits distributions to members and the payment of fees to its directors, and requires its directors to approve any other payments the company makes to them. Beyond those, the regulation also picks up companies registered without ‘Limited’ in their name under section 150(1), companies holding a licence continued in force by section 151 that allows the omission of ‘Limited’, and certain companies limited by guarantee registered before the relevant commencement whose constitutions commit them to community, charitable or superannuation-scheme purposes.

Qualification turns on the constitution, and the constitution has to be right at the point of registration for the company to be classified correctly from the outset. A standard proprietary company constitution does not qualify: it contains none of the restrictions the concession depends on. This is also why the classification cannot be treated as a box to tick on a form. ASIC can review whether the constitution supports the reduced fee, and a company claiming the concession without the necessary clauses is exposed to the difference.

Converting an ordinary company to special purpose status later is possible where the company genuinely falls within one of the categories. It requires amending the constitution by special resolution and notifying ASIC. The notification itself carries no ASIC fee; the cost is the constitutional amendment work, and the reduced fee applies going forward rather than retrospectively.

CoSec Partners registers superannuation trustee companies and other qualifying special purpose companies as part of standard formation work. Our SMSF establishment package includes the corporate trustee with a constitution drafted for the superannuation trustee category from day one, so the entity is correctly classified for the reduced ASIC fee throughout its life. Where a client asks us to register an ordinary trustee company for a family or unit trust, we register it as an ordinary proprietary company, because that is what it is.