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Speaking in a recent webcast with Crypto Tax Calculator, Cadena Legal Harrison Dell explained that when it comes to documenting the ownership of crypto assets by an SMSF, at a minimum there needs to be trustee resolutions and trustee minute stating that a particular entity hosts the wallet and a particular person is controlling the private key.<\/p>\n
“The trustee minutes should nominate which person is going to have the private key for safekeeping and how they're going to keep it and and I would strongly recommend the use of a ledger or some other cold wallet solution,\u201d he stated.<\/p>\n
SMSF trustees can go further than this with their documentation, however.<\/p>\n
\u201cYou can do a deed or a deed poll which is a very solemn swearing of how certain things have happened and certain things are owned,\u201d he stated.<\/p>\n
By establishing a deed, this creates legal rights for the trust against the trustee in the case of assets being misappropriated, he explained.<\/p>\n
\u201cWhile the chance of that happening is relatively low seeing as SMSFs are closely held, I have heard of such cases in divorces where there\u2019s crypto involved in the fund and it mysteriously disappears,\u201d he warned.<\/p>\n
\u201cAll sorts of things can happen so I do strongly recommended documenting it further.\u201d<\/p>\n
Crypto Tax Calculator chief executive Shane Harrison said there are also technology solutions such as Gnosis Safe that can help keep assets safe such as having a multi key unlock where there are multiple parties required to unlock the wallet in the first place.<\/p>\n
\u201cThere are also managed wallet providers, at least in the US, so there are definitely options out there. As demand in the space grows, more innovative solutions are emerging so you don\u2019t have a situation where somebody has just miraculously lost the private keys when they\u2019re entering a divorce situation,\u201d he said.<\/p>\n
Mr Dell warned that these types of situations do happen, which can have \u201can egregious impact for the fund, as well as financially for the parties\u201d.<\/p>\n
\u201cI\u2019ve seen it go very badly in the family court where judges are not impressed. Stepping outside of superannuation, this goes to any sort of ownership of crypto as part of a divorce, where accountants are normally involved as well. It can disappear off the face of the earth quite quickly [with the person responsible] claiming it never existed \u2014 it's really common,\u201d he warned.<\/p>\n
\u201cIt's quite a problem and it's not going to be solved unless advisers are documenting what people are doing.\u201d<\/p>\n
In terms of documentation, Mr Dell said SMSFs can go as far as making a statutory declaration.<\/p>\n
\u201cHowever, this isn\u2019t really necessary unless demanded by the ATO. I wouldn\u2019t go beyond a deed or deed poll to acknowledge ownership of wallets and that includes any wallets that it goes through,\u201d he stated.<\/p>\n
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Miranda Brownlee
\n01 September 2022
\nsmsfadvisor.com.au<\/p>\n
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Thorough documentation can help mitigate the risk of crypto assets going missing in situations like divorce, says a specialist lawyer.<\/em><\/strong><\/p>\n \u00a0<\/p>\n","protected":false},"author":1,"featured_media":1339,"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\/1338"}],"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=1338"}],"version-history":[{"count":1,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1338\/revisions"}],"predecessor-version":[{"id":1340,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1338\/revisions\/1340"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/media\/1339"}],"wp:attachment":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/media?parent=1338"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/categories?post=1338"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/tags?post=1338"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}