The next two months may be last golden opportunity for LRBA

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The Government is proposing the introduction of new measures that will impact all Limited Recourse Borrowing Arrangements (LRBA), entered into or after 1 July 2018.  These measures, if enacted, will include a member’s share of any outstanding LRBA debt in the calculation of their total superannuation balance, which may have a flow-on effect on that […]

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Reversionary TRISs – Government acts to resolve issue

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The Government has now moved to resolve the issue of reversionary TRISs, which has been dragging on since 1 July 2017 when the “Fair and Sustainable Superannuation” changes commenced. The reversionary TRIS issue is simply that when a reversionary pension transfers on the death of the primary pensioner, the pension is now a death benefit.  […]

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Shorten’s proposal will have proportionally greater adverse impact on retirees with small balances than retirees with multi-million $ balances

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Mr Shorten’s proposal announced this week that cash refunds of excess franking credits should be scrapped will have a greater proportionate adverse impact on a retiree with a $500,000 balance than a retiree with a $5m balance. If implemented, a retiree with only $500,000 in super will not be entitled to any franking credits (as the retiree […]

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Beware the estate planning transfer balance cap

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So what is this “estate planning transfer balance cap trap” that can arise from adopting the mirror reversionary pension strategy? More importantly, is there a way to avoid it? Well, it all stems from how the Transfer Balance Account works. Let’s begin with a bit of a refresher: As we all know, the Transfer Balance […]

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Are tailored BDBNs the magic bullet for SMSF estate planning?

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A tailored BDBN is one which is subject to special conditions which can make it useful to deal with various modern estate planning issues. One common condition is to impose a “cascading” succession of nominees in case the primary nominee fails to survive the fund member or fails to remain an eligible recipient of the death […]

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Family trusts more important than ever

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Family trusts have always been an important structure for business planning, tax planning and estate planning. This is mainly due to their tax efficiency, asset protection, flexibility and succession possibilities. But now, family trusts are increasingly being used for retirement planning purposes since the Government introduced more measures to limit the ability to make both […]

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Issues to consider with $600k ‘Downsizer’ strategy

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From 1 July 2018, the Federal Government is allowing ‘Downsizer contributions’ of up to $300,000 per individual who sells their eligible current or former family home after age 65. What are the considerations? Mainly Centrelink and taxable income.     Conclusion The Downsizer contribution is beneficial if the Client has no age pension entitlement and is […]

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ATO holds Liechtenstein foundation to be resident trust estate

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A recent Private Binding Ruling issued by the ATO (PBR 1051209890341) has held that an entity established in Liechtenstein (a small county between Switzerland and Austria) as a Stiftung (aka Foundation) was to be treated for Australian tax purposes as a resident tax estate. A Stiftung is a separate legal entity which has capital and is able […]

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Estate equalisation by courts not so straightforward

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In a 2015 court case a claim by the daughters of the deceased for an equal share of his estate was dismissed. It was taken that the daughters had been fairly treated even though their brother inherited significantly more. This sounds like a legal decision from another century but it seems that fair and equal […]

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Key issues in estate planning using trusts

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A look at two important family trust issues that advisers may come across in establishing or managing the workings of a client’s estate planning using trusts. Issue #1: Who should be the Appointor of my Family Trust? When completing an instruction form for arranging a new family trust for a client, it is very likely […]

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