Speaking in a recent podcast, SMSF Alliance principal David Busoli said that when dealing with family law super splits, SMSF professionals need to be cognisant of the fact that divorce is a highly emotional and emotive situation where they’re not just dealing with the SIS and tax rules.
“While we do have to comply with [the rules], you’re dealing with people and emotions. [Sometimes], things are amicable. However, it’s not always the case, and when it’s not, it throws the rule book out the window completely,” Mr Busoli told The SMSF Adviser Show.
Mr Busoli said SMSF professionals could provide a very valuable service by being the honest broker and standing in the middle.
“Some of these divorces are really nasty, they might involve family violence, they might involve restraining orders, and sometimes in those sorts of situations, you’re just not going to get the people talking to each other – you’ll be lucky to even get them in the same room together. Someone needs to do that, a trusted intermediary, and this is where I think where we can come in,” he explained.
While Mr Busoli noted that lawyers would be part of the process as well, in some cases, they can have an “antagonistic relationship” between each other as well.
“We have an interesting situation though where we have to consider for whom we are acting as well. Are we acting for the trustees or this member or that member? We’ve got to be very careful in terms of the line that we walk as professionals, but certainly, we can facilitate conversations,” he said.
In situations where things are particularly volatile with a divorce, Mr Busoli said SMSF professionals could provide a very beneficial service by being the person who speaks to the ATO.
“I can tell you that the Tax Office have been absolutely marvellous in every single situation that we’ve had with them, they certainly deserve a huge tick in situations like this, which can become particularly volatile and particularly nasty and people can just go off the rails. The Tax Office in our dealings with them have been sensitive, caring and reasonable,” he said.
“My suggestion for a situation where you can’t get the cooperation of one of the trustees to do the right thing, but you’ve got at least one that will do the right thing, is talk to the ATO about it and try to work through a process. That’s a huge service we can do apart from anything to do with compliance.”
