A federal parliamentary review has recommended the trustee limit for SMSFs be increased from four to 10 people.

The parliamentary committee report, The Structure and Operation of the Superannaution Industry, said it was persuaded by the arguments put forward by the SMSF Professionals' Association of Australia (SPAA) and others in relation to trustee limits.

"The committee heard some evidence that this limit should be increased in response to the prevalence of family businesses and funds that operate over two or more generations," the report said.

In its submission to the inquiry on the structure and operation of the superannuation industry, SPAA said that, under a choice of fund environment, children wanted to join SMSFs that were established by their parents.

"There is a view currently in practice that the parents now have to decide which of the children is to be excluded from that process," the SPAA submission said.

Evidence from the Association of Independent Retirees showed some families were concerned about who would deal with their SMSF when one of the parents died.

Business lawyers Townsends welcomed the committee's recommendation.

"This review of the four-member ceiling is welcome.  If the ceiling is lifted it is likely that SMSFs will be permitted to have more than four members if the fifth and subsequent members are child beneficiaries of one of the other members," Townsend principal Peter Townsend said.