superannuation and trusts

A recent determination by the Minister for Social Services aims to provide greater clarity on the social security impacts of the legacy pension amnesty. Introduced in December 2024, the amnesty inadvertently caused certain 'legacy' pensions to lose their asset-test exemption for Centrelink purposes, even if not commuted. This new determination allows the Secretary to deem these pensions as still asset-test exempt if the loss of exemption was solely due to the option to commute under the amnesty. This, combined with upcoming debt waiver provisions for commuted legacy pensions, is intended to resolve unintended consequences for social security recipients.

The SMSF Association is urging for a substantial reform of the Compensation Scheme of Last Resort (CSLR), particularly its funding model, following the release of the FY27 Initial Levy Estimate of $137.5 million. CEO Peter Burgess highlighted that the $126.9 million attributed to the personal financial advice sub-sector is disproportionately high and unsustainable, arguing that the profession should not solely bear the cost of failed advice and products. Concerns are amplified by the estimate not including potential claims from the Shield of First Guardian, which could further increase the revised levy. The association also awaits news on a special levy to cover a past shortfall. They are pressing the government to release the findings of the Treasury-led review into the CSLR's long-term sustainability, emphasizing the need for greater transparency and a sustainable funding pathway for the advice profession.

The SMSF Association has appointed John Perri as Technical Manager to enhance its technical support for members amidst significant reforms in the financial services and superannuation sectors. Perri, with 30 years of experience at AMP, will focus on supporting the SMSF Specialised Advisor accreditation program and developing technical content to help members meet their Continuing Professional Development (CPD) obligations. His appointment is seen as a key move to strengthen the association's technical capabilities and its voice in policy discussions.

The Australian federal government, through Minister for Financial Services Daniel Mulino, has identified improving the retirement phase of superannuation as a key priority. Mulino noted that while the accumulation phase of the superannuation system is robust, the retirement phase requires enhanced product offerings and better financial advice to ensure individuals achieve high-quality outcomes as they transition from working life. To support this, the government has released discussion papers focused on improving data collection regarding retirement phase outcomes and developing best practice principles in collaboration with industry stakeholders. In addition to enhancing retirement income solutions, the government is also committed to streamlining regulatory processes within the financial services sector. The aim is to reduce administrative costs and improve regulatory efficiency across the various governing bodies. This initiative seeks to align the engagement of different regulators to achieve shared public policy goals more effectively.

Several accounting bodies, including CPA Australia and the SMSF Association, are lobbying the ATO to extend the transitional relief period for employers regarding the upcoming Payday Super reforms, set to commence on July 1, 2026. They argue that the significant changes to payroll, finance, and superannuation systems, particularly for small businesses, necessitate a longer adaptation window. The bodies are requesting an extension of the low-risk employer compliance period from June 30, 2027, to June 30, 2028, and are seeking clearer guidance on compliance concepts like 'reasonably practicable'. The submission also highlights the challenge for around 250,000 employers currently using the Small Business Superannuation Clearing House, which will cease operations in July 2026, forcing them to find new providers. The accounting groups are also advocating for ATO-driven messaging to assist employers in monitoring superannuation payments and systems, along with specific relief for issues arising from fund mergers, rejected contributions, and third-party delays.

Self-Managed Super Funds (SMSFs) are being highlighted as an advantageous vehicle for parents with children under 18 to receive superannuation guarantee (SG) contributions from part-time work. Recent changes to super laws effective from July 1, 2022, removed the $450-per-month minimum threshold for SG payments, meaning even minors undertaking casual employment that meets weekly hour requirements will now receive contributions. Superannuation legal specialist Michael Hallinan suggests that SMSFs offer a cost-effective and parentally manageable way to administer these small, often unexpected, super balances, as administration costs can be shared and are proportional to the account size. While minors can join an SMSF under parental guidance, they will need to become a trustee or director upon turning 18, at which point they can decide to remain in the SMSF or roll over their funds.

The article, though not directly focused on superannuation and trusts, mentions a significant slide in adviser numbers, with 58% fewer advisers due to an upcoming education deadline. While the content provided is limited, this context suggests a potential impact on the financial advice sector, which is crucial for superannuation and trust management and planning. The dwindling number of qualified advisers could have downstream effects on individuals' ability to access advice related to their superannuation and trust structures.

The fallout from the First Guardian situation continues to impact Diversa, with the Australian Prudential Regulation Authority (APRA) increasing its oversight. This development highlights ongoing regulatory attention on superannuation fund governance and the repercussions of significant fund collapses or issues. The article appears to be part of a year-end recap of top stories, suggesting the First Guardian incident and its subsequent impact on funds like Diversa were significant events within the superannuation landscape during the reporting period.

The article highlights the potential for Self-Managed Superannuation Funds (SMSFs) to generate income by renting out investment properties on platforms like Airbnb. This approach offers flexibility without long-term commitments. However, it strongly advises thorough research before pursuing this investment strategy.

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