FAMILY MONEY Susan Hely
I keep coming across people who have set up a family trust – and they’re not always super-wealthy. Often, they have been advised to take advantage of the tax benefits that are unique to family trusts.
Peter Bembrick, a tax partner at HLB Mann Judd, is a big fan of family trusts. He says they can be a useful vehicle to hold family assets over a long time and allow multiple generations to build up wealth.
Family trusts are usually established as discretionary trusts, he says, meaning that the trustee has complete discretion over distributing the income and capital to various family members and associated people who are set out in the trust deed as eligible beneficiaries.
Family trusts have offered tax-effective income, in particular for children aged over 18 and for retirees. One of their most attractive features has been income splitting and streaming different classes of income to different beneficiaries.
The distributions could be varied in any way from year to year, and no beneficiary has a guaranteed right to receive distributions, providing the family with a high degree of flexibility over the way that the trust is managed.
How it will work now
But that advantage has been under the ATO’s microscope for several years. Finally, it has released its long-awaited detailed guidance on the way it will apply Section 100A of the tax legislation (relating to anti-avoidance) to distributions from family trusts.
The final legislation is due in the next few months.
Denne historien er fra July 2022-utgaven av Money Magazine Australia.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent ? Logg på
Denne historien er fra July 2022-utgaven av Money Magazine Australia.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent? Logg på
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.