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SMSFs, LRBAs and NALI

SMSFs, LRBAs and NALI

Overview When dealing with limited recourse borrowing arrangements (LRBAs), it is important to understand the consequences that may arise where the LRBA is not implemented and maintained on a proper basis. This is especially so in the case of a self managed superannuation fund (SMSF) undertaking a related party LRBA. The terms and conditions of [read more]

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Company constitutions and SMSFs

This article considers why the constitution of a corporate trustee is important and what should be included in an SMSF constitution. Firstly, there are many reasons why a coporate trustee is preferable to individual trustees for an SMSF. For example a corporate trustee has the following benefits over indiviuals: ease of succession planning and meeting [read more]

Splitting documents should not be overlooked

Splitting documents should not be overlooked

Where a relationship breakdown has occurred between spouses, the parties’ superannuation entitlements may be subject to an overall family law property settlement. Typically this involves one spouse agreeing to or otherwise being required to give up some of their superannuation benefits in favour of the other spouse based on appropriately drafted orders or financial agreements. [read more]

The proportioning rule is key to many super strategies

The proportioning rule is key to many super strategies

Introduction The proportioning rule is used to calculate the tax free and taxable components of a superannuation benefit. Having a sound understanding of this rule is key to many super strategies. Overview –– proportioning rule The proportioning rule provides that the tax free and taxable components of a superannuation benefit are taken to be paid [read more]

Why should you order trusts from DBA Lawyers?

Why should you order trusts from DBA Lawyers?

While DBA is recognised as Australia’s leading SMSF law firm, it is also well known for it’s great depth of tax and trusts expertise. DBA Lawyers offers an excellent discretionary trust deed that is easy to read, provides great flexibility and reflects the latest legislative changes. Also included is a detailed memo, trustee resolutions, covering [read more]

Six member SMSFs — important trap hinted at by the Senate Economics Legislation Committee

Six member SMSFs — important trap hinted at by the Senate Economics Legislation Committee

When considering six member SMSFs, the Senate Economics Legislation Committee has hinted at an important trap that advisers must remember. Background On 27 April 2018 the then Minister for Revenue and Financial Services Kelly O’Dwyer MP announced that the government would expand the limit on the maximum number of members in SMSFs from four to [read more]

Civil penalty orders imposed on SMSF trustees

Civil penalty orders imposed on SMSF trustees

This article considers a number of civil penalty orders that have been imposed by the courts on trustees of SMSFs that contravened the civil penalty provisions under s 193 of the Superannuation Industry (Supervision) Act 1993 (Cth) (‘SISA’). Background Substantial penalties can be imposed for contravening the following: the sole purpose test; lending or providing financial [read more]

PS LA 2020/3 — how the ATO applies administrative penalties on SMSF trustees/directors

PS LA 2020/3 — how the ATO applies administrative penalties on SMSF trustees/directors

Introduction The ATO recently published Law Administration Practice Statement PS LA 2020/3 to guide ATO staff on how to apply administrative penalties. This provides the methodology on how ATO case officers make determinations on imposing and remitting penalties for contraventions under s 166 of the Superannuation Industry (Supervision) Act 1993 (Cth) (‘SISA’). The ATO’s view is [read more]

An important reminder on excess contributions: Purcell and Commissioner of Taxation [2020] AATA 4235

An important reminder on excess contributions: Purcell and Commissioner of Taxation [2020] AATA 4235

The recent AAT decision of Purcell and Commissioner of Taxation [2020] AATA 4235 serves as an important reminder when making superannuation contributions. Facts For the full decision, see http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/AATA//2020/4235.html. A summary of the fact is as follows. The AAT indicated that during the financial year ended 30 June 2018, Mrs Purcell had a non-concessional contributions [read more]