Articles

Using your SMSF to purchase a property with a loan

Married couple Jason and Molly Hilder have set up a Self-Managed Super Fund known as the Hilder Superannuation Fund and wish to purchase a property with the assistance of loan funds. Wisely, Jason and Molly consult with their accountant and financial advisor as to how to go about the purchase and loan arrangements properly.

Jason and Molly learn that there are very strict compliance rules, among them:

• The property must be for investment purposes; they and any fund members cannot live in it;
• An entity will need to be set up to hold the property while the loan is on foot;
• In the event of loan default the lender has no right of recourse on any other assets of the fund;

There are some technical terms.    

• The Apparent Purchaser: is the purchaser of the property established purely for the purpose of acquiring and owning the property during the course of the loan. The Apparent Purchaser is sometimes referred to as the Bare Trustee.
• The Holding Trust: the trust set up with its own trustee while the borrowing for the property is on foot. Whilst the Hilder Superannuation Fund is ultimately purchasing the property the apparent purchaser is the trustee of the Holding Trust.        
• The Fund Trustee: the trustee of the Hilder Superannuation Fund. The property must be held on trust for the […]
  

Pre Sentence Reports

If a Defendant has a criminal record, the court may order a Pre Sentence Report. The report, prepared by a Probation Officer, will assist the magistrate/judge in determining sentence and will cover such issues as family history, education, employment and attitude towards the offence. The report is made available to us at court on the sentence date.

Sometimes, the magistrate/judge may request a same-day report from the duty Probation Officer at the court. More commonly though, the matter will be adjourned for around 6 weeks for the preparation of the report. The appointment with the Probation Officer must be made within 7 days of the court ordering the Pre-Sentence Report and it is vital that the Defendant keeps the appointment.

To assist in the preparation of the report, we recommend that the Defendant prepares themselves prior to the appointment. Examples of a few things that the Defendant should be prepared to hand to the probation officer are details about the community involvement links, any educational certificates/references and what efforts and lifestyle changes the Defendant has made to avoid the risk of re-offending.

Although the recommendations made by the Probation Officer are not binding on the court, they can be persuasive on the court’s determination of the appropriate sentence. It is an excellent opportunity for the […]

Some basic considerations in establishing a Special Disability Trust

In 2006 amendments were made to Commonwealth legislation, the Social Security Act (SSA) for the benefit of a severely disabled person to meet their reasonable care, accommodation and medical needs

Assets held in a Special Disability Trust, provided they are below the threshold ($626,000 as at 1 July 2014) will not count towards the Beneficiary’s assessable assets (for the purpose of determining the beneficiary’s eligibility for a pension). An immediate family member can also transfer assets into the Special Disability Trust (up to $500,000), without having that transfer affect their own eligibility for a pension.

Certain requirements

There are certain requirements in establishing a Special Disability Trust including:

• The Trust must be established with a trust deed or by a Will and comply with the model trust deed provisions under the SSA;
• The Trust must have only one Beneficiary;
• The Trustee/s must be over the age of 18;
• The Trust must meet the severe disability definition in the SSA and provide for the accommodation and care needs of the Beneficiary;
• The Trust will only exist during the Beneficiary’s lifetime;
• The Trustee must provide annual financial statements of the trust as at 30 June of the relevant financial year.

 Definition of Severe Disability

A Beneficiary under a trust must establish the following to meet the definition of Severe Disability:

•  A level of […]
  

The Mediation Process

Mediation is a voluntary and cooperative process requiring goodwill and flexibility from the parties. Both parties must agree to mediation and seek to reach a workable agreement to settle the dispute to their mutual satisfaction.

Mediation is a flexible process in which your mediator helps the parties to draw up the rules for the process and decide how the mediation will be conducted. The parties remain in control of both the procedure and the result as mediation is designed to specifically meet their needs and allows them to reach a solution acceptable to them.

Over and above conflict resolution, mediation aims to re-establish appropriate communication between the parties and thereby prevent future conflict. Mediation is conducted in private, in confidence, and in an informal setting conducive to open and frank communication. Once agreement has been reached, your mediator will help in the drafting of terms.

Why choose mediation?

Mediation will offer you a timely, cost-effective alternative to the court process, whether your dispute relates to:

• family law (property or children)
• workplace & industrial disputes
• deceased estates
• business or partnership
• relationship breakdown
• commercial litigation
• leasing
• your neighbour

As your mediator, Michael Hume places great importance on understanding your position, insightful analysis of the issues and appropriate briefing to brainstorm all settlement options. Michael Hume’s sensitive outline of the process will give you the confidence to navigate the challenges […]