Start building your SMSF - Vesting Deed
Self Managed Super Fund Vesting Deed
For whatever reason, you may find that you no longer wish to keep your Self-Managed Super Fund going. If this is the case, you need to wind it up.
You will need to generate a SMSF Vesting Deed which will formally wind up (vest) the Self Managed Super Fund.
Why should I wind up the SMSF?
• The relationships between members or directors has changed
• You no longer have the time or interest to run the SMSF
• The fund's investments would be managed more effectively with a different type of fund
What do I need to do to terminate the SMSF?
1. You will need to pay out or rollover the balance of members’ super to another fund, which may involve selling assets.
2. A final audit must be completed before you lodge the last SMSF annual return. Remember to indicate the fund is being wound up.
3. You need to pay any outstanding tax and other debts before you close your fund’s bank account.
4. A resolution must be passed determining that the Fund is to be vested (terminated).
5. The final accounts of the fund must be prepared.
Once this is done, you can build our Deed of SMSF Vesting and build a set of documents which allows you to vest and close the Self Managed Super Fund.
After building this document on our website you are emailed:
1. Self Managed Super Fund - Deed of Variation of Vesting
2. Minutes
3. Letter of Advice on the law firm's letterhead signed by a Partner
Have a look at the Sample document and there are many training videos and hints to help you as you build the document.
For more legal advice telephone us. We are a law firm. We can help you answer the questions.
Dr Brett Davies, CTA, AIAMA, BJuris, LLB, Dip Ed, BArts(Hons), LLM, MBA, SJD
Legal Consolidated Barristers and Solicitors
39 Stirling Highway, Nedlands, WA
(Post Office Box 5169, Dalkeith, WA 6009)
Mobile: 04777-96959
Toll Free: 1800-14-16-12
Direct: 08 6389-0400
Reception: 08 6389-0100
Email: brett@legalconsolidated.com
Skype: brettkennethdavies
A Vesting Deed is used when you no longer want the structure to exist, in this case a Self-Managed Super Fund. You need to roll over the Super into another structure (amongst other things). You need to formally wind up (vest) the trust to close down this unused structure.
Why should I wind up the trust?
- The Trust has achieved its original purpose
- It has no assets
- The trust has reached its vesting date
What do I need to do to terminate the trust?
1. The capital of the trust must be distributed in accordance with the trust deed.
2. The Trustee must satisfy any existing liabilities of the trust. This includes any existing or future
taxation liabilities that arise as a result of termination of the trust.
3. The Trustee must pass a resolution determining that the trust is to be vested (terminated).
4. The final accounts of the trust, including a final tax return, must be prepared.
Once this is done, you can build our Deed of Vesting of a Trust and build a set of documents which allows you to vest and close the family trust.
After building this document on our website you are emailed:
1. Family Trust - Deed of Variation of Vesting
2. Minutes
3. Letter of advice
Why should I wind up the trust?
- The Trust has achieved its original purpose
- It has no assets
- The controllers of the trust don%u2019t want to continue
- The trust has reached its vesting date
What do I need to do to terminate the trust?
1. The capital of the trust must be distributed in accordance with the trust deed.
2. The Trustee must satisfy any existing liabilities of the trust. This includes any existing or future
taxation liabilities that arise as a result of termination of the trust.
3. The Trustee must pass a resolution determining that the trust is to be vested (terminated).
4. The final accounts of the trust, including a final tax return, must be prepared.
5. Build this document
To update your Family Trust, we need to first identify it. We do this by referring to:
the Family Trust name (e.g. Jones Family Trust)
date the Family Trust Deed, that established the Family Trust, was signed
the Settlor's name.
Every trust has a name. Sadly, they are generally quite boring. E.g. Smith Family Trust, named after Mr Smith.
The trust name is a 'nick name'. It is not registered anywhere. It just helps you and your accountant identify your Family Trust.
Take out your Deed of Trust that first started your Family Trust. Have a look at the front cover, it will normally have the name of your Family Trust. It will be repeated in the body of the Deed as well. Check any subsequent Deeds of Variation, to make sure that your Family Trust didn't change its name.
Be careful to not confuse the Family Trust name with your Trustee. Your Trustee (e.g. XYZ Pty Ltd) is not your trust name.
There is generally no difference between a:
Family Discretionary Trust
Family Trust
Discretionary Trust
We lawyers tend to call them 'Discretionary Trusts' because we like the fact that every year the Trustee has the discretion to distribute income to different beneficiaries.
Whereas, our friends the accountants, usual call them 'Family Trusts'. This is because only mum and dad and the immediate family would operate a family business out of a 'Family Trust'. If people out of the immediate family are involved in the business then a 'Family Trust' would not be appropriate.
Because you are building your Deed of Variation at our law firm's website you:
1. retain legal professional privilege
2. are protected by our law firm PI insurance
3. receive legal advice
4. by law have us act in your best interests, over our own
Only a law firm provides the above.
'Resettlement' happens when you alter the Trust to such a level that it becomes a new trust. You would then suffer Capital Gains Tax, Stamp Duty and other issues.
As a taxation law firm we ensure that you do not suffer a 'resettlement' by applying:
1. Full Federal Court decision in FC of T v Clark [2011] FCAFC 5
2. High Court decision in FC of T v Commercial Nominees [2001] HCA 33
3. ATO%u2019s withdrawal in 2012 of its Statement of Principles on the Creation of a New Trust and its release of the ATO's Decision Impact Statement
