Equity Trustees put the increase in legal disputes down to an influx of customers to the self-managed super realm using do-it-yourself or 'off-the-shelf' trusts.
"A common issue we see with trusts is where someone has gone to their accountant to seek advice on how to minimise tax. The accountant then uses an off-the-shelf trust which is often not drafted properly," said Marie Brownell, Equity Trustees' national manager of estate planning.
"Australians are a nation of DIY fanatics but trusts are complex legal structures and not something anyone should create without specialist legal advice."
Equity Trustees cited 2020's 'important' case of Wareham v Marsella in the Supreme Court of Victoria as reason for establishing a binding death benefit.
Ms Brownell said the case highlights the importance of knowing an SMSF's trust's rules.
"It’s often forgotten that superannuation death benefits do not automatically fall into the estate for distribution in accordance with the will," she said.
"In the absence of a binding death benefit nomination, the trustee of the fund will decide who gets the benefit.
"What’s usually overlooked is who that continuing trustee might be. If it’s someone who stands to benefit themselves, in a manner contrary to your wishes, then you need to carefully consider what steps you need to take to ensure your death benefit is paid as you intend."
Popularity of SMSFs on the rise
ATO data for the June quarter indicates there were 597,900 SMSFs in Australia comprising of more than 1.1 million individual members.
This is an increase of 4% in the number of SMSFs compared to June 2020, and nearly 9% compared to five years ago.
The average SMSF held an average of $1.3 million in assets in the 2018-19 financial year, up 22% from five years prior, for a total of more than $822 billion in Australian assets.
In the June 2021 quarter there was just under $57 billion in limited recourse borrowing arrangements (LRBAs) on the books, more than double from five years ago.
Approximately $212 million of assets was held in cryptocurrency, up 11.57% in less than two years.
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| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.99% p.a. | 7.00% p.a. | $3,323 | Principal & Interest | Variable | $null | $720 | 70% |
| Promoted | Disclosure | ||||||||||
7.19% p.a. | 7.74% p.a. | $3,391 | Principal & Interest | Variable | $395 | $null | 60% |
| ||||||||||||
7.24% p.a. | 7.26% p.a. | $3,407 | Principal & Interest | Variable | $0 | $710 | 70% | Disclosure | ||||||||||||
7.25% p.a. | 7.65% p.a. | $3,411 | Principal & Interest | Variable | $30 | $825 | 80% | |||||||||||||
7.74% p.a. | 7.76% p.a. | $3,579 | Principal & Interest | Variable | $0 | $710 | 80% | Disclosure | ||||||||||||
7.75% p.a. | 7.83% p.a. | $3,582 | Principal & Interest | Variable | $0 | $995 | 80% | |||||||||||||
7.49% p.a. | 7.50% p.a. | $3,493 | Principal & Interest | Variable | $0 | $720 | 80% |
| Promoted | Disclosure |
Photo by Christian Bowen on Unsplash
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