Tuesday, June 16, 2015

View Legal and superannuation proceeds trusts

Last week’s post explained the broad requirements and main benefits of a Superannuation Proceeds Trust (SPT) established under a will. This week’s post focuses on how View Legal’s testamentary trust (TT) wills deal with any superannuation benefits that are paid to a will maker's estate.

Generally, the range of potential beneficiaries listed under a TT are wider than dependants for tax purposes. The way in which View Legal crafts its TTs however gives the trustee complete discretion about which of the beneficiaries may receive any superannuation benefits available for distribution.

In particular, the terms of the will allow the trustee to essentially establish a 'sub trust' of the TT for receipt of the superannuation proceeds – with the only beneficiaries being those who satisfy the definition of a tax dependant.

In this way, the various benefits of having a SPT, as outlined in last week's post, can be achieved.

If the trustee chooses to utilise a SPT, an example of how the estate assets could flow is as follows:

Image credit: Adrian Ruiz cc