SUPERCentral News
With an increasing number of elderly parents living with their adult children is it possible that an adult child of a deceased parent could, on the death of the parent, receive their parent’s superannuation tax free?
Two significant changes have been made to the Work Bonus scheme. These changes apply from 1 January 2024. The first change is that an initial credit of $4,000 will be granted to the “work bonus bank” of each new age pension recipient. The second is that the maximum balance of the “work bonus bank” has been increased to $11,800 (previously the maximum balance was $7,800).
Contrary to popular belief, simply tearing up or ignoring signed legal documents does not eradicate its effect. The reality is, once a documented agreement is executed (by signature or common seal) it can only be unmade, corrected or amended by the signing of other relevant legal documents.
The NSW Govt has advised that from 1 February 2024 their duties will increase as follows...
AASB 2020-2: What could be more innocent than an accounting standards board deciding to create a simple, objective, consistent, comparable, transparent and enforceable financial reporting framework? Well if the financial reporting framework was also sustainable, diverse and carbon neutral then we would have a “world’s best” financial reporting framework. What rational person could possibly take exception? Well read on…
One of the most significant features of account-based pensions is the ability to commute the pension, whether in full (also known as a 100% commutation) or in part (a partial commutation ie. less than 100%).
Draft legislation to (non-constitutionally) enshrine the objective of superannuation has now (20 November 2023) been introduced into Parliament. The draft legislation is titled the Superannuation (Objective) Bill 2023. This draft legislation has, at least, the virtue of brevity: the entire bill can be read in under 10 minutes.
Did you know that SUPERCentral have a library of over 100 SMSF Toolkit Documents to assist you in the management of your client’s SMSF’s?
Generally pensions cannot be commenced if the initial pension account balance is greater than $1.9m (the current transfer balance cap which applies from 1 July 2023). However, what if...
In a recent Private Binding Ruling the ATO was asked to consider the tax treatment of the death benefit where the death benefit was paid after the surviving spouse had passed.
A very interesting (and surprising) Private Binding Ruling has been recently released by the ATO (reference details at the foot of the article). In short, because a trustee (of a self-managed superannuation fund) took over 28 weeks to pay a commutation lump sum, the benefit was considered to be a death benefit and not a member benefit.
This case illustrates the consequence where the net sale proceeds was not entirely applied in the application of the replacement home. Mr and Mrs Parton, rather like Bill and Wilma (refer article: Downsizing and the Age Pension), sold their home and did not immediately acquire a replacement home. Once they acquired the replacement home, they did not use up all of the sale proceeds. They intended that a portion of the net sale proceeds would be used in repairing and modifying their replacement home.
Often individuals and couples, once they are retired and receiving the age pension, will want to downsize their home to more suitable accommodation. If the individual or couple own their own home, the home is excluded from the age pension assets test, irrespective of the value of the home. But what happens to their age pension if they sell their current home to buy another home?
Any super fund member who has commenced an account-based pension since 1 July 2017 (even if the pension has been entirely rolled back to accumulation phase or cashed out) can now view their updated personal transfer balance cap by using the MyGov website to access ATO online services. With the increase in the general transfer balance cap from $1.7m to $1.9m (which took effect on 1 July 2023), super fund members personal transfer balance cap will be increased in proportion to their unused transfer balance cap (also known as “transfer balance cap space”).
Registrations are open for our estate planning course commencing on Thursday 24 August. EP Advantage is: a 10-week online program, maximum 1-2 hrs per week Delivers practical scenario-based training on estate planning Online modules are presented by Townsends Lawyers estate planning specialists Brian Hor and Peter Townsend FAAA (FPA) approved for 18 CPD points Course brochure here. When asked what are the strongest features of the course, previous participants shared: Peter … ‘practical aspect of discussion’ Bethany … ‘capacity for all learning styles to buy in’ Jeremy … ‘using real life scenarios to apply the theory and content’ Christian … ‘course had me mentally categorising my clients’ Narelle … ‘The conversation style was excellent, as was unpacking the case studies each week’ For more information or to register with SUPERCentral please call 02 8296 6266 or email Shadi at shadi@supercentral.com.au.
Death Bed benefit withdrawals is a poignant description of the situation where a member of a superannuation fund makes a request to withdrawal their superannuation benefit as a lump sum before they die. Typically, this is done as the member has no dependants who could receive the benefit tax free. If a superannuation death benefit is paid to the independent adult children of the member, the benefit will generally be taxed at 16.5% (including medicare).
The income free area (the amount of income which an age pension recipient can receive per fortnight before the income reduces the age pension entitlement) has been increased to $204 (previously $190) for single age pension and $360 (previously $336) for a pensioner couple.
Now that the end of the 2022/23 financial year is almost here, superannuation members who are currently receiving pensions need to take certain actions.
In this case a binding death benefit nomination was held to be invalid because it had not been given to the trustee, that is, not given to all the trustees of the fund. The court found that only one trustee had been given the nomination. (Case reference Williams v Williams [2023] QSC 90).
The recent Commonwealth Budget contained 4 material superannuation proposals. The most significant proposal (additional 15% tax on fund earnings on super balances of $3m or more) had been previously announced. The superannuation proposals detailed in the Budget are set out in this article.