Amendments to section 102AG and testamentary trusts – has the baby gone out with the bath water?

Treasury Laws Amendment (2019 Measures No. 3) Act 2019 (Cth) received assent on 22 June 2020. It amends section 102AG of the Income Tax Assessment Act 1936 in relation to taxation of minors in receipt of income from a testamentary trust.  The purpose of the amendment was to reduce revenue leakage [...]

2020-08-19T10:16:29+10:00August 19th, 2020|

Testamentary trusts and reimbursements agreements – do I actually have to pay my children?

Background Section 100A of the Income Tax Assessment Act 1936 (ITAA 1936) provides that where there is a deemed reimbursement agreement between the trustee and a beneficiary, then, instead of the beneficiary being taxed on that income, it is the trustee who is taxed at the maximum marginal tax rate plus [...]

2020-08-19T10:16:17+10:00August 19th, 2020|

The Goldilocks Trust® – providing for the blended family in a testamentary discretionary trust

Background It is a tired trope in estate planning practice that the most difficult family to provide a certain and secure estate plan for, is the blended family. The spouses wish to provide for each other, but they also wish to provide for their own children who are not the children [...]

2020-08-19T10:16:01+10:00August 19th, 2020|

How does one attain a vested interest?

Serwin v Dolso[1] Many older wills include a gift containing a condition like: I give the rest and residue of my estate to Mr Smith provided that if Mr Smith predeceases me or dies before attaining a vested interest, I give the residue to Ms Brown. In this gift clause, what is [...]

2020-05-19T08:30:11+10:00May 19th, 2020|

Appeal fails in Marsella case

Background In March 2019 we reported on the Victorian case of Marsella[1] in relation to the exercise of discretion to choose a death benefit beneficiary by a trustee of a self-managed super fund (SMSF). That case was remarkable because it was the first case where a disappointed beneficiary of a deceased [...]

2020-05-19T08:22:49+10:00May 19th, 2020|

Witnessing wills and powers of attorney by videoconference

Justice Legislation (COVID-19 Emergency Response – Wills & Enduring Documents) – Regulation 2020 (Regulation) The Queensland Government has today published the Regulation setting out how wills and enduring powers of attorney (EPOAs) may be witnessed by video link. The Regulation may be accessed here: https://www.legislation.qld.gov.au/view/whole/html/asmade/sl-2020-0072 The Regulation acts to deem that [...]

2020-05-19T08:42:33+10:00May 15th, 2020|

Video witnessing Queensland wills

Parliaments around Australia are passing new legislation to help the wheels of commerce turn during these difficult coronavirus times. Succession law has also had considerable difficulties in dealing with the quarantine and isolation restrictions when signing and witnessing wills and powers of attorney. A will needs 2 independent witnesses and a [...]

2020-04-24T13:39:11+10:00April 24th, 2020|

Beware undue influence presumption between parent and child

In a recent decision of the Court of Appeal in Queensland, the Court has provided some much needed clarification around the undue influence presumption in section 87 of the Powers of Attorney Act (PoA). Under the PoA, any transaction between the principal named in an enduring power of attorney and the [...]

2020-04-06T10:49:13+10:00April 6th, 2020|

Breach of repair and maintenance obligations does not lead to the forfeiture of a life interest

In the recent case of Nomchong -v- Vey-Cox the Court considered whether a life interest was forfeited when the life tenant (i.e. the beneficiary of the life interest) failed to comply with their obligation to repair and maintain the property. The will used reasonably common drafting in setting up a life interest and [...]

2020-04-06T10:41:41+10:00April 6th, 2020|

Bernard & Bernard – the Family Court examines the protection provided by testamentary trusts

Asset protection generally All asset protection is a compromise between protecting assets and retaining control and enjoyment of those assets. Asset protection spectrum Complete control and enjoyment = no asset protection Example: you own the asset legally and beneficially, e.g. family home No control or enjoyment = excellent asset protection Example: asset owned [...]

2020-04-06T10:38:19+10:00April 6th, 2020|
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