Maximise TRIS strategy before it ‘drops dead’, advisers told

Maximise TRIS strategy before it ‘drops dead’, advisers told

SMSF practitioners are being urged to take action quickly, as speculation continues to suggest that certain lump sum TRIS strategies are likely to be in the federal budget’s firing line.

SMSF Academy director Aaron Dunn said one particular TRIS strategy, which involves clients satisfying their minimum payment obligations with a payment taxed as a lump sum, allows TRIS strategies to be used by wider range of SMSF trustees, included those on higher incomes.

The strategy received considerable interest following a private binding ruling issued by the ATO in December last year.

Speaking at a SMSF Academy event in Sydney this week, Mr Dunn said the strategy is “clearly on the radar of the government” and practitioners should therefore consider getting these pensions in place before budget night.

“This is the area they consider high-net-worth individuals to be taking advantage of, which when you think about it [has been the case],” said Mr Dunn.

TRIS strategies were originally only designed to replace income as individuals scaled down their work hours, he added.

“I would suggest that you want to get these kinds of things in place before budget night, because history would suggest that they will put a 'drop dead' date on that on that night,” said Mr Dunn.

“They have [done that] previously with unit trust arrangements, where they made some of the changes to those on budget night.”

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Maximise TRIS strategy before it ‘drops dead’, advisers told
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