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DBA Monthly Newsletters

Crystallisation

As a result of our May 2007 article, we have received numerous queries regarding ‘crystallisation’ and wish to address these below as well as clarifying some comments made in our prior article. From 1 July 2007, all superannuation interests may be comprised of tax free and taxable components. The tax free component is comprised of [read more]

Super – maximise tax free

On midnight 30 June 2007, the ‘crystallisation’ rules strike on your superannuation interests. Similar to musical chairs, if you have overlooked your prior planning, you may be on your own. We receive many queries on this topic and provide some answers below. What are the crystallisation rules all about? Broadly, the crystallisation rules ‘lock in’ [read more]

Pension Regulations Finalised

Pension regulations have been finalised clarifying the way the new account-based pensions (‘ABP’) will operate from 1 July 2007. ABPs require a minimum annual payment amount to be paid to the pensioner each financial year and no maximum applies. The minimum annual payment amount is based on the pensioner’s super account balance on 1 July [read more]

Super legislation passed

The legislation introducing most of the proposed changes to superannuation has been passed. There are several features worth considering below. Existing pension – tax-free Prior to clarification in recent legislation, it appeared that a pension commenced prior to 1 July 2007 (‘existing pension’) would have missed out on locking in the pre-July 1983 component as [read more]

Insurance and death

Many people have been concerned about the tax treatment of superannuation benefits paid on death that include insurance proceeds. In particular, in certain circumstances proceeds may be taxed at up to 46.5%. Superannuation death benefits Where a lump sum is paid on the death of a member that contains insurance proceeds in respect of which [read more]

New Draft Pension Regulations Released

The long awaited pension regulations proposed in the 2006 Budget were released in draft form on 21 December 2006. Broadly, SMSFs will be able to pay two new types of pension: an account-based pension (‘ABP’) and a transition to retirement income stream (‘TRIS’). Pensions may only revert to children in limited circumstances. Account-based Pension The [read more]

Estate planning tool

CAUTION! The pension strategy discussed below is now superseded by draft regulations of 21 December 2006. Please obtain expert advice. We have received very positive feedback from advisers regarding the pro-forma letter in our November newsletter. We have received numerous requests asking for a similar tool in respect of estate planning. Accordingly, we include a [read more]

Budget planning for clients

Great planning opportunities exist leading up to the implementation of the Budget proposals. However, from 1 July 2007, many of these opportunities will cease. Accordingly, it is vital that advisers meet with clients to discuss superannuation and estate planning strategies that may be implemented before 1 July 2007. A pro-active adviser can add great value [read more]

Business and investment structuring post-budget

Deciding on the optimal business structure to operate through, or to hold investments in, has always been a complex exercise. There is no magic formula or ‘one size fits all’ approach as every person is different and has different objectives. A good adviser needs to have a sound understanding of the commercial and practical features [read more]