{"id":1317,"date":"2022-08-29T05:19:05","date_gmt":"2022-08-29T05:19:05","guid":{"rendered":"https:\/\/actinvest.com.au\/?p=1317"},"modified":"2022-08-29T05:19:05","modified_gmt":"2022-08-29T05:19:05","slug":"withdrawal-strategies-before-death-require-careful-consideration","status":"publish","type":"post","link":"https:\/\/actinvest.com.au\/index.php\/withdrawal-strategies-before-death-require-careful-consideration\/","title":{"rendered":"Withdrawal strategies before death require careful consideration"},"content":{"rendered":"

Professionals have been warned there is a \u201cfine line\u201d between member benefits and death benefits where a member plans to withdraw shortly before death.<\/strong><\/p>\n

\"\"<\/p>\n

\u00a0<\/p>\n

In a recent article, Cooper Grace Ward Lawyers senior associate Steven Jell said there can be a different tax treatment depending on whether a superannuation payment is a member benefit or a death benefit. \u201cFor example, a person over the age of 65 can access their superannuation tax free. However, if the same person dies with assets remaining in superannuation, then there could be tax payable when their remaining superannuation entitlements leave the fund,\u201d he explained.<\/p>\n

Mr Jell noted that most people want to leave their superannuation in the superannuation environment as long as possible because of the tax concessions that are offered through superannuation.<\/p>\n

\u201cHowever, if we leave it too long and there are remaining entitlements in a superannuation fund at that individual\u2019s death, then there could be tax payable when those amounts leave the superannuation fund,\u201d he stated.<\/p>\n

Some members therefore want to pull their superannuation out on their deathbed, he said.<\/p>\n

\u201c[However] there can be quite a fine line when it comes to determining whether a payment is a member benefit or a superannuation death benefit where members are trying to complete a superannuation member withdrawal shortly prior to their death,\u201d he cautioned.<\/p>\n

\u201cWhat we see is that most strategies like this fail to take into account all of the relevant considerations.\u201d<\/p>\n

Mr Jell said there are a number of things to consider when looking to implement a member withdrawal shortly prior to a person\u2019s death.\u00a0<\/p>\n

\u201cWe\u2019ve got to look at, well, who\u2019s the person making the request? Is it the member individually or is it their attorney? Who controls the fund? Is it directors of the corporate trustee, or we dealing with individual trustees when it comes to approving the payment to the member?\u201d he questioned.<\/p>\n

It is also important to look at what the trust deed says and what will happen to that individual\u2019s estate planning considerations if the payment is made from the fund prior to their death and the assets are then held in their personal name, he added.<\/p>\n

The types of assets that are being transferred also needs to be considered, he said.<\/p>\n

\u201cDo we need to sell assets to complete the payment or are we looking to transfer assets in specie?\u201d he said.<\/p>\n

\u201cThe reality is, if all of these things aren\u2019t considered appropriately, the tax consequences of getting a strategy like this wrong can be substantial.\u201d<\/p>\n

Whether this kind of strategy will be appropriate will vary for each person, he noted.<\/p>\n

\u00a0<\/p>\n

Miranda Brownlee<\/p>\n

23 August 2022
\nsmsfadviser.com<\/p>\n","protected":false},"excerpt":{"rendered":"

Professionals have been warned there is a \u201cfine line\u201d between member benefits and death benefits where a member plans to withdraw shortly before death.<\/strong><\/p>\n","protected":false},"author":1,"featured_media":1318,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[4],"tags":[],"_links":{"self":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1317"}],"collection":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/comments?post=1317"}],"version-history":[{"count":1,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1317\/revisions"}],"predecessor-version":[{"id":1319,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1317\/revisions\/1319"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/media\/1318"}],"wp:attachment":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/media?parent=1317"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/categories?post=1317"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/tags?post=1317"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}