Learn more about SMSF and Divorce
- The event of divorce will instigate a process of dividing assets in an SMSF as super is part of the marital asset base. Australian super legislation (SIS Act), tax law and family law increase the complexity of the process and it is important to plan carefully and seek advice.
- The process of splitting an SMSF will depend on whether the members have reached their preservation age and can access their super. Consideration must also be given to the taxable and tax-free components of the super assets.
- Members must decide if they will remain in that fund, open a new SMSF or move to a different fund. Matters will be further complicated if the members are individual trustees, rather than directors of a trustee company.
- If a member is leaving the SMSF, some assets may need to be liquidated and careful planning for tax implications is necessary. In addition, unlisted assets, such as real estate within the SMSF will have to be valued.
- Should members have insurance under their SMSF, the divorce may initiate changes to binding death nominations
- Should there be third-party members in the SMSF, the impact on them must also be considered.
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SMSF and Divorce
The advantage of receiving advice
SMSF and divorce can be a complex matter and needs to be executed in a particular order and defined manner. Using an expert can alleviate mistakes that could result in penalties and unnecessary tax payments.