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A new form for Enduring Powers of Attorney (‘EPOA’) commenced in Victoria on 1 April 2004. An EPOA authorises one or more persons (‘Attorneys’) to undertake any legal or financial transaction on behalf of the person making the power (‘Donor’). The power is enduring as it continues even though the Donor loses legal capacity. However, [read more]

SMSF Trust Deeds

As you may be aware, there have been substantial reforms in recent times impacting self managed superannuation funds (‘SMSF’). Recent changes include the following: Contribution Rules Government ‘co-contributions’ can, from mid 2003, be made to funds with appropriate powers in their trust deed. This provides a potential maximum of $1,500 in co-contributions by the government [read more]

Reserving From May 2004

The May Budget resulted in several significant changes to reserving strategies in superannuation funds. Contributions Reserving The new SIS Regulations preclude the payment of employer contributions directly to a contributions reserve thereby postponing the surcharge liability until subsequent allocation to a member’s account. From 12 May 2004, the trustee of an accumulation fund must generally [read more]

Complying Pensions

New Transitional Relief New transitional relief (‘New TR’) became law on 25 June 2004. This is supplementary to the transitional relief that became law on 12 May 2004 (‘Existing TR’) for SMSFs providing defined benefit pensions (‘DBP’). A DBP is any pension other than an allocated or market linked (aka ‘growth’) pension. Broadly, the New [read more]

SMSFs & Artwork

The ATO recently issued four Interpretative Decisions, ID 2004/248, 249, 250 & 251 on artwork investments by SMSFs. SMSFs that invest in artwork must satisfy a range of tests, especially if the artwork is used by the members. First of all, artwork owned by a SMSF and displayed in a member’s home or office is [read more]

SMSFs paying Defined Benefit Pensions (‘DBP’)

The 2004 Budget has introduced a number of unexpected changes to the ability of self managed superannuation funds (‘SMSFs’) to pay Defined Benefit Pensions (‘DBPs’); ie, broadly, any pension other than an allocated pension (‘AP’). Up until 11 May 2004, SMSFs were free to provide (assuming their trust deeds permitted) a range of DBPs including [read more]

Trustee liability

The recent South Australian Supreme Court case of Hanel v O’Neil [2003] SASC 409 is causing uncertainty in relation to a very basic asset protection strategy. The court held that a director was personally liable for debts incurred by the corporate trustee of a family trust even though the trustee was covered by a right [read more]

Pension Changes

This article highlights an important change applying to pensions commencing on or after 1 October 2003. We will first discuss the new rules having regard to allocated pensions (AP) and then briefly discuss their application to complying pensions. Broadly, the new rules require the minimum payment in the financial year a pension is commuted to [read more]

The Pension PDS

From 11 March 2004, trustees of self managed superannuation funds (SMSF) will have to issue a Product Disclosure Statement (PDS) whenever a member converts from growth to pension phase. A PDS is a statement prepared by the issuer of a financial product containing all of the information that a person would reasonably require for the [read more]