There is an option outside super for protecting and sharing wealth.
With wide-ranging changes to super taking effect on July 1, it is worth considering whether it’s time to put your non-super money into a family trust. A trust can tax-effectively distribute wealth among family members, protect your assets from creditors and help with succession planning.
Annual concessional super contributions will be capped at $25,000 from July and, for a wealthier retiree, the maximum that can be held in super will be $1.6 million. Family trusts are one of the few tax-effective vehicles other than super. “Family trusts are going to exponentially grow again,” says Peter Bobbin, managing principal of Argyle Lawyers.
Here are some key questions and answers about family trusts.
How many are there?
In 2014 there were 802,645, according to the tax office. Around 20,000 are set up every year, so Bobbin estimates there are 850,000 now.
How much do they hold?
$344 billion.
How much money do you need to set one up?
Just as self-managed super funds have a minimum recommended amount of around $250,000 to justify the annual costs, a family trust needs at least a similar amount to make it worthwhile. It needs to pay accounting fees and lodge tax returns.
Is there a maximum contribution amount?
Esta historia es de la edición April 2017 de Money Magazine Australia.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor ? Conectar
Esta historia es de la edición April 2017 de Money Magazine Australia.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor? Conectar
An outrageous, beautiful monopoly
Telstra's mobile business is a cash machine with few competitors, giving it the highest returns in the world.
Drop the anchor to judge value
Buying and selling decisions should be based on where a stock price is going, not where it has been.
Powering the AI boom
Beyond the software and chipmakers, where will the energy come from?
Get into life
Tucked inside super are products that can protect you from life's inevitable uncertainties.
Paths to home ownership
Taking the road less travelled can sometimes deliver unexpected benefits.
Sold! Quick ways to add value
Small, strategic changes can have a big impact on the look and feel of your home. And get you a better price on auction day.
Money lessons the kids need to know
Your children can learn a lot from your past money mishaps. Here are eight financial conversations I have had with mine.
Property-investing rules: are they likely to change?
The pressure for the government to curb the tax benefits of tax concessions, such as negative gearing and the capital gains tax discount, is unrelenting. Most recently, independent senators David Pocock and Jacqui Lambie proposed five options for paring back investment property tax concessions, with savings to the Federal budget of up to $60 billion over the next decade.
What's love got to do with it?
A rollercoaster of emotions could be driving poor crypto behaviour.
Are we ready to be cash-free?
Saying goodbye to our piggy banks too soon could leave small businesses in the dark when problems arise.
