Members of self-managed super funds
If you are a trustee or member of a self-managed super fund (SMSF) and your relationship breaks down, you must continue to act in accordance with the super laws and the trust deed of your fund.
An SMSF works like any other super fund but the responsibility of managing it rests solely with the trustees. As trustee you have control over and responsibility for your fund's investment decisions. You also have to manage the fund's legal responsibilities. Despite any difficulties you may have with an individual on a personal level, as a trustee you must continue to act in the best interests of all members at all times.
- exclude another trustee from the decision-making process
- ignore requests to redeem assets and roll money over to another regulated complying super fund
- take any action that is not allowed by Superannuation Industry (Supervision) Act 1993 (SISA) or the SMSF's trust deed.
If you do any of these actions, your SMSF can be made non-complying and will be subject to significant tax consequences. You could also be disqualified as a trustee, effectively stopping you from running an SMSF in the future.
It is important to consider these issues in a marriage or de facto relationship breakdown. However, they apply to all relationship breakdowns – for example, between a father and son, an uncle and niece, or friends. Legal proceedings between trustees or members of your SMSF do not suspend your trustee obligations.
If you are unsure of your responsibilities as a trustee, phone us on 13 10 20 or seek the help of an independent professional.
Acquiring 'in specie' super assets
The Commissioner has previously made a determination that allows a trustee to acquire assets from a related party of the fund as a result of marriage breakdown. Amended legislation has broadened the scope to the breakdown of opposite-sex and same-sex de facto relationships.
In addition, transitional exemption provisions apply to in-house assets where assets are acquired as the result of a relationship breakdown.
These changes apply to assets acquired on or after 17 November 2010.
If your marriage or relationship breaks down, you should be aware of what can happen to your super entitlements.