Scenario:

This product is designed for these scenarios:

• SMSF member considering losing capacity in future
  (but has not yet lost capacity)

• Particularly if: 

  • no surviving spouse to receive BDBN / pension 

  • or no children to receive BDBN benefits

• Or an intention to spend remaining superannuation soon:

  • receive SMSF death benefits earlier to purchase assets / pay off debt

  • financial adviser confirms amounts in SMSF not required to remain in SMSF - they will be excess to needs
    (but member does not want to withdraw the amounts now)

• Or an intention to keep assets in the SMSF as long as possible

This product is an alternative to actual withdrawal of the superanuation by the member.

It allows for an authorised person to sign for the withdrawal instead of the member (e.g. when the member has lost capacity to sign legal documents).

Issue - Deciding When to Withdraw Super: 

Your client may be concerned that they do no / will not have dependent children under 18 years of age or a remaining spouse to receive BDBN distributions or a reversionary pension after their death tax-free. 

Although this is not a requirement to be able to receive the superannuation death benefit, only for the tax advantage.

The member may withdraw their superannuation as a lump sum tax-free after age 65 or after retirement (or other conditions of release).

Or they may give another trusted advisor or family member the power to sign the required documentation to withdraw their superannuation from their SMSF into an account of their choosing after they have lost capacity (but this must be done before the member's death).

This could be particularly useful as a strategy in place where spouses have reciprocally nominated each other in their BDBNs. 

But the authorised person cannot be the other spouse or this would not work as intended.

Technical Notes: 

The current SMSF trust deed should allow the member to delegate the required authority to a person to sign documentation on their behalf as constituting that member's prior instructions to the SMSF for their superannuation benefits to be withdrawn all as a lump sum once they have met a condition of release. 

The T Legal © SMSF trust deed allows for these authorisations.

If the SMSF member does not wish to withdraw all their superannuation at certain times, they may delegate their powers as member to another person who may sign the withdrawal of superannuation documents on behalf of the member for the SMSF trustee then to action.

The recipient of the power may also hold an enduring power of attorney for the SMSF member allowing them to replace the member as director of the corporate trustee where required (e.g. for a sole member SMSF they may appoint themselves under Corporations Act 2001 section 201F(2)).

Service: 

T Legal provides expert review of the current SMSF trust deed as part of preparation of your SMSF withdrawal authority documentation required to maintain compliance with your SMSF trust deed. 

If the current SMSF trust deed is found to be deficient, an SMSF deed update may be purchased to be signed first for an affordable fixed price.

Contact T Legal on the number / email below or submit a response to the SMSF withdrawal authority online order form 

Scenario: 

This product is designed for this scenario:

• Past payments / distributions made from SMSF

• Recipient was past preservation age at the time

• Those payments / distributions from SMSF were not recorded on transaction statements as a lump sum

• Preparing SMSF financial statements (in progress)

• Auditor has confirmed that placing TRIS documents with commencement date before the first payment / distribution will be accepted as covered by SMSF compliant pension commencement

Issue - Potential Early Withdrawal of Super: 

Your client may have received distributions from their SMSF for which they were not yet eligible to receive (e.g. they had not yet retired) and cannot pay back into the SMSF (e.g. for cashflow or risk of the return of funds being deemed a contribution due to the SMSF trust deed provisions at the time). 

Compliant transition to retirement income stream (TRIS) documentation (that may be confirmatory i.e. signed to formalise a commencement date in the past) is one method to seek to evidence that those payments were made under a compliant superannuation income stream that commenced after the member reached their preservation age (but had not yet retired). 

Technical Notes: 

A TRIS allows an SMSF member to access their superannuation after their preservation age before retiring, subject to a maximum withdrawal per year.

The ATO in its finalised Taxation Ruling TR 2013/5 notes that the commencement date of a superannuation income stream must be agreed by the trustee and the member (i.e. by a compliant drafted Transition to Retirement Income Stream Deed product) in accordance with the SMSF trust deed.

The ATO also states (para 54) that a ‘superannuation income stream’ refers to the complying agreement / deed itself between the SMSF and its member under the SMSF governing rules and not to the actual payment(s) made from the SMSF accounts. 

The ATO has stated in its Trustee Resolutions Checklist QC 25912 that it would accept written records of a resolution signed after the fact if actual evidence exists that the actual transaction took place previously (e.g. by transaction receipts). 

See the recent example of Goldenville where the Tribunal considered whether a confirmatory "memorialised" resolution was valid in light of inferences that the decision behind the resolution could not have been made before the effective date, which was before the date of signing the resolutions. 

The ATO has also stated that a pension's commencement date cannot precede the member's request or application for the pension. In some cases even if the SMSF may not have a formal application process, the member is still required to have requested the pension and agreed to its terms before its commencement. 

Confirmatory TRIS documentation, if not precluded under the SMSF governing rules or the facts, may seek to confirm that the TRIS arrangement had commenced at an earlier date. 

Service: 

T Legal provides expert review of the current SMSF trust deed as part of preparation of your transition to retirement income stream documentation required to maintain compliance with superannuation income stream requirements. 

If the current SMSF trust deed is found to be deficient, an SMSF deed update may be purchased to be signed first for an affordable fixed price.

Contact T Legal on the number / email below or submit a response to the TRIS online order form 

See volume pricing below for general TRIS pricing ($176 couple $99 single)