The non-arm’s length income (NALI) provisions contained in s 295-550 of the Income Tax Assessment Act 1997 (ITAA 1997) continue to be a divisive topic, with recent non-arm’s length expense (NALE) changes providing some welcome relief while also highlighting the urgent need for further legislative change for specific NALI and the capital gains tax (CGT) [read more]
This article is the first in a series on SMSF succession planning. In Part 1, we examine the key characteristics of a sound SMSF succession plan including in relation to planning for control of the fund to pass into trusted hands in the event of a member’s death or loss of capacity. Introduction For many [read more]
Non-arm’s length income (NALI) applies a 45% tax to both ordinary and statutory income of a superannuation fund. A net capital gain is statutory income. However, how does NALI interact with the capital gains tax (CGT) provisions? The ATO has recently released Tax Determination (TD) 2024/5 to outline its current view on the interaction between [read more]
The Corporations Act 2001 (Cth) (CA) contains a number of important requirements in relation to registering new companies with the Australian Securities and Investments Commission (ASIC). These requirements mandate, among other things, that certain written consents and agreements must be in place for all proposed directors, secretaries and shareholders of a new company prior to [read more]
Overview A company may act in a range of roles, including where it trades or invests in its own right, or where it acts as the trustee of an SMSF or a trust such as a discretionary, unit or bare trust. Having the right constitution and related documents is therefore prudent. Moreover, having up to [read more]
Overview The taxation of trusts continues to be an area of scrutiny for the ATO. The ATO has released a webpage titled ‘Trust distributions done right’ that provides guidance to practitioners on how to prepare for year-end trust distributions. The webpage (QC 101752) can be found here. Clearly, the ATO is concerned with trustees and [read more]
Introduction With the penalty unit increasing from $313 to $330 in proposed legislation, SMSFs need to be extremely careful as this results in most administrative penalties increasing from $16,500 (ie, 60 penalty units x $275) to $19,800 (ie, 60 penalty units x $330). This follows the increase from $275 to $313 that already occurred on [read more]
The recent NSW Supreme Court decision of van Camp v Bellahealth Pty Ltd [2024] NSWSC 7 (22 January 2024) (van Camp v Bellahealth) provides important lessons for advisers when considering a person’s capacity to make a BDBN. It also reinforces the value of keeping good records and file notes. Facts Dr Nespolon was the sole [read more]
For many Australians, superannuation is a significant asset especially if a self managed superannuation fund (SMSF) is involved. However, despite this, many do not plan ahead for what happens to their superannuation upon their loss of capacity or death. We recommend that every SMSF member should develop a succession plan to ensure there is a [read more]
Many SMSF members do not plan ahead in relation to what is to happen with their superannuation upon loss of capacity, death or other relevant life events. Indeed, in DBA Lawyers’ experience, a considerable proportion of SMSFs have outdated, inappropriate or no succession plans in place. Unfortunately, such lack of planning can give rise to [read more]
