In the realm of special disability trusts, compliance is paramount to ensure the well-being and financial security of individuals with disabilities. To be recognised as a complying special disability trust, certain conditions must be met and maintained. Let’s delve into the essential aspects of the compliance process that guardians, trustees, and beneficiaries need to be aware of.
Complying Special Disability Trust: Key Requirements
>Trust Deed Compliance:
To qualify as a complying special disability trust, a trust must have a trust deed aligning with the compulsory conditions outlined in the model trust deed. In cases where deviations occur, a waiver for non-compliant clauses may be issued.
The trust must continuously meet the legislative requirements specific to special disability trusts. Staying informed about evolving regulations is crucial for ongoing compliance.
>Yearly Financial Statements:
Trustees are obligated to furnish yearly financial statements, certified by an accountant affiliated with CPA Australia, Institute of Chartered Accountants in Australia, or National Institute of Accountants. These statements must adhere to relevant Australian Accounting Standards.
Centrelink/DVA reserves the right to request any documentation related to the trust, including financial statements and tax returns. Open communication and timely submission of requested documents are pivotal for maintaining compliance.
>Independent Audit Provision:
The trust deed must empower the principal beneficiary and/or donor to request an independent audit if they are dissatisfied with trust management. Additionally, Centrelink/DVA has the authority to initiate an independent audit at the trust’s expense, particularly when there are suspicions of asset misuse.
Should one or more of the specified conditions not be satisfied, the special disability trust risks becoming non-compliant. In such instances, the trust will be assessed under standard private trust and company rules from the date it is deemed non-complying by a delegate.
Seeking Waivers and Rectifying Contraventions
Acknowledging the potential for non-compliance, the Secretary retains the authority to waive contraventions for a defined period while efforts are made to rectify the situation. This underscores the importance of prompt action and transparent communication in addressing compliance issues.
Understanding and adhering to the compliance process for special disability trusts is essential for the financial stability and overall well-being of beneficiaries. Proactive measures, including regular communication with relevant authorities and timely rectification of any issues, are crucial to maintaining compliance and ensuring the trust continues to serve its intended purpose
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Disclaimer and Warning
The information above is of a general nature only. It should not be used as a source to make financial decisions. It’s also important to note that the legislation and figures related to this topic tend to change regularly and therefore the information above may not reflect the current status. We recommend that if you are looking for advice on this matter, you should contact us.