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Breast cancer: a personal story

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It is women’s health week from 5th to 9th September so it is a great time to spend time focussing on your health. Here, Prue MacSween shares her experience with breast cancer and urges everyone to take the time to check in with their health professional,. Doing so saved her life.

Boozies, fun bags, tits, jugs, whatever you like to call them, I’ve always had a fond relationship with my breasts.

Being somewhat “upfront” from my early teenage years, I’d come to depend on my boozies as they helped attract blokes and been a distraction from my backside, which I always felt would give a Kardashian a run for their money!

That was until January 2014 when I was towelling dry after a shower. As I rubbed cream on my right bosom I felt a rather large thickening under my nipple. Maybe I was imagining it as I’d always had lumpy boozies and I reassured myself that the regular and recent mammogram I’d had was all clear. Nothing to worry about.

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Prue, with her mother (left) and friend, Carlotta (right)

I could have let it slide, shrugged it off, gone into denial as so many women seem to do, but I happened to be going to my GP for a pre-holiday check-up a few days later. As I was leaving the surgery, almost as an afterthought, I mentioned the thickening. Once she felt it, she insisted on booking me in immediately for an ultrasound and biopsy.

As I lay on the table having the biopsy I was thinking about the plans I had for my holiday. What about my work? What about my family and my many commitments? I didn’t have time to accommodate this inconvenience!

The biopsy revealed a tumour which was cancerous and suddenly, the overseas holiday was cancelled. Then came the part where you have to share the news with those closest to you. I guess shock, denial then finally, acceptance kicks in along with the seemingly never-ending rounds of doctors, Xrays, ultrasounds and MRIs. Unexpected cost. Unplanned life disruption.

No time to ponder the “why me?” I had a job to do. I needed to find the best medical team I could. Luckily, I had been on an Advisory Committee for Cancer Australia and I was soon walking into my breast surgeon’s rooms. A gentle, charming Associate Professor who had to deal with this bolshy woman telling him she was not married to her boobs, and to get them off if necessary!

He hosed me down and informed me that he intended to do chemotherapy treatment first to try to shrink the tumour and stop its aggressive assault on my body.

The morning of the day I was to start chemo one of my oldest and closest friends, Ian “Rosco” Ross died after his battle with pancreatic cancer.

I did a few TV and radio interviews about this incredible, much-loved mate and then headed to hospital for round one of chemo. Raw with emotion from his loss, I had little time to think about my fate or the challenge I was about to face.

I remember walking into the cottage where so many other souls were having their dose of the toxic chemicals which were hopefully going to kill the alien in their bodies.

Some were regulars, the old hands who were familiar with the process. Reading, dozing, staring out at the garden as they pondered their fate or talking quietly with loved-ones and friends as the bags of liquid travelled into their bodies.

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Prue MacSween refused to allow her diagnosis to stop her from enjoying life

And always close by, the breast care nurses buzzing around, caring, comforting, advising.

I took up the offer of the cold cap therapy, which I was told would help save my hair. They put this helmet on your head, turn on the machine and almost instantaneously, you get this incredible head pain and brain freeze. As icicles formed on my scalp and an instant headache hit me, I decided I didn’t give a bugger about my hair. Let it fall out!

After my first session I crawled into bed when I got home. I had been warned about the nausea, the metallic taste and ulcers in your mouth. The lethargy and tiredness. The foetal position in my bed was my preferred position for a few days after each session.

But I was determined not to let this bastard inside me dictate my life or define me. When I could, I dragged myself into work. My hair fell out in clumps within days of the first chemo session and no amount of make-up could improve my pallor. The wigs I bought were my salvation even though I couldn’t wait to pull them off as soon as I walked in the door.

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Prue, after chemotherapy, celebrating Christmas with Deborra Lee Furness

After three months and six sessions of chemo, the tumour had shrunk and the next stage was my lumpectomy. Before the op, I instructed my surgeon to remove my breast if he felt he needed to during the operation. Either way, he had to remove a lot of breast tissue due to the size of the lump and he promised he would deliver me new boozies. Something to look forward to!

I woke up with tubes everywhere, bound up tightly and in pain. Delighted to learn all had gone well and my new boobs would soon be revealed. They were gorgeous! I felt 20 years old again and was so proud of them, I was happy to display them to anyone who asked how I had gone!

My next hurdle was radiography. I had been warned this daily exercise could be painful as the rays burnt your skin. To me it seemed like a small price to pay if it was going to kill off any random cells that may have escaped into my body.

More than two years on, my hair is growing back, a little courser and curlier. My eyelashes are growing and sadly my hair on my legs is also doing well.

My first big hurdle was my first annual check-up. The MRI and ultrasound revealed all was clear. Phew! I’ve recently had my second official clearance from the doctor so three more years to go before I can really say I have beaten this thing.

But I remain defiant and grateful. Throughout it all I was fatalistic about the outcome. I have had an amazing, fulfilled life. I have loved and been loved and a beautiful, devoted family. That’s all one can ask for.

I can only say to anyone who is experiencing this course of events to put your faith in the wonderful medical teams we have in this country. Some people, sadly do not survive, but so many of us (well over 85% do).

It was one hell of a journey. It wasn’t the kind of journey I was planning to take, but I believe we all grow from our experiences … I know I have.

By Prue MacSween,
02 September 2016

Resources

  • For more information on breast cancer visit the Breast Cancer Network Australia website.
  • If you have been recently diagnosed you can order a free ‘My Journey Kit’ here or you can call 1800 500 258.
  • To get involved and help raise money for breast cancer this September you can attend a Pink Lady Luncheon.Click here for more information.
  • You can also buy Pink Lady merchandise here which helps ensure Australians affected by breast cancer get the best support, information and treatment.

The Farm Protectors are working with the local community to help educate Australian Farmers

Our very own Stephen Wait recently spoke at an event run at Underbool football clubrooms on Friday 15 July. The event was called “Look Over the Farm Gate” and was organised for farmers and residences to discuss recognising and managing stress related to rural life.

Stephen spoke to the group about areas covering risk management, business structure, succession planning and estate planning. The Farm Protectors work with farmers to ensure that all of these areas are in order to help remove a lot of stress for farmers and their families. Stephen finished his talk by saying “Peace of mind and understanding: to me, that’s the main thing people get out of it”.

Read the full article below:

Underbool Told to ‘Look Over the Farm Gate’

By Naomi Leach

Underbool farmers and residents have had a crash course in recognizing and managing stress related to rural life, A ‘Look Over the Farm Gate ‘ event held at the Underbool football clubrooms on Friday, July 15 encouraged those present to be aware of potential signs of stress in their own life as well as keeping a watch out for the well-being of mates who might be struggling.

Similar events were held at Patchewollock and Lascelles in the last few weeks.

The evening started with a free dinner of sausages for the kids and lasagna for the adults with the bar available throughout the night.

An estimated 40 adults and 25 children took part in the event, with many younger farming couples present.

More than an information night, ‘Over the Farm Gate ‘ was a mix of socialising, live music, a screening of local historical film footage and the start of a conversation about the pressures of farming and how to deal with them in a healthy way.

mugician

‘Waldo the Greatest’ – Hopetoun-based magician Wal Ferguson – entranced the crowd with card tricks, bamboozling pom-poms and ropes that changed length apparently in front of the audience’s eyes.

The children were particularly taken with Waldo and formed a tight row of chairs in front of his makeshift magic bench.

The adults weren’t immune: Waldo was able to use maths to get most people in the room to guess the colour and animal design of a credit card, apparently set fire to a participant’s $100 note and have another attempt to hypnotise a balloon.

Live music was played by Maurice Conway, a singer-songwriter from Hopetoun. Maurice performed a song he and event organizer Michael Robertson had written on the theme of the evening about looking out for your mates when times are tough.

Maurice also performed several songs he has written about the towns of Tempy and Patchewollock, which will form part of an album of Mallee town songs Maurice is planning to release by the time of the Patchewollock Music Festival this year.

Mauricesinger says that the songs have proved hugely popular on social media. The Patchewollock song was viewed 4,000 times on Facebook while the Tempy song has attracted over 14,000 views.

So far Timberoo and Goyura have also had their own songs composed and Underbool might hope that Friday night’s event will be enough to inspire Maurice to tum his focus to the northern Mallee towns.

Michael Robertson gave a short presentation mid-way through the evening listing the signs of stress and the damaging effect that it can have on health, relationships and farm businesses.

“Farming is the most stressful occupation of any,” Michael told the group.

“One in three in the room here tonight will suffer from stress.”

Difficulty getting motivated and withdrawing from social activities were two signs of many which Michael suggested may signal excessive stress.

Taking regular exercise, making good use of breaks in farm work to relax, learning to laugh more and settling disputes as they arise were all suggested methods of de-stressing.

stephen waite

Stephen Wait, a financial planner and founder of the Farm Protectors, spoke to the group about the benefits and importance of arranging organizing a will, discussing and finalising an equitable and appropriate succession plan for your farm and ensuring that you have arranged medical, financial and guardianship powers of attorney.

Stephen, who grew up on a wheat farm near Manangatang, says he founded the Farm Protectors because he said he saw a need that wasn’t being met. When working with a farm business, he’ll look at the areas of risk management, business structure, succession planning and estate planning, noting that, ensuring that everything is in order can help remove a lot of stress for farmers.

NORTH WEST EXPRESS – THURS, JULY 21, 2016 – PAGE 3

August 2016 Update

Here’s a confronting question: what would you do if the main breadwinner in your household could no longer bring in an income? Do you have a Plan B? Most people don’t. This is why insurance is paramount.

Curve balls, they’re unexpected, often deceptive and it’s impossible to predict their trajectory. That’s why they’re so devastating – in sport and in life.

Curve balls are pretty common, but so few people are prepared for them. With the mortgage to pay, school fees to fund and day-to-day living expenses to meet, you could run down your savings very quickly and face financial difficulty.

If you don’t have a plan B in place, please contact our office today!

This Newsletter looks at the Olympic journey of Chris Anstey, why Super is important and when the right time is to get advice.

We hope you enjoy this Newsletter, and as always, we urge you to call our office for personal advice if there is any area that you need to discuss.


My Olympic Journey – Chris AnsteyDepositphotos_85080176_m-2015

With the 2016 Rio Olympic games well underway we wanted to take a moment to share the Olympic journey of Chris Anstey, two-time Olympian and the ambassador for our financial body, La Trobe Financial.

In this article the former Olympian, Chris Anstey, discusses his Olympic Journey.

Click here to read entire article.


What is the point of Super?Sherlock Holmes Deerstalker Hat, Vintage Clock, Retro Magnifier And Smoking Pipe On The Black Table Background. Overhead View. Investigation Concept.

This simple question was raised by the Murray Review (financial system inquiry) and the Review suggested that the answer should be “to provide income in retirement to substitute or supplement the Age Pension”.

Click here to read entire article.

 


When is the right time to get advice?Cute child on the phone

As a general rule, it’s never too early and never too late to seek the advice of a professional financial adviser. If you think financial advice is just about helping you to save more for your retirement, think again.

Click here to read entire article.

 


Jeans for Genes Day

To donate to Jeans for Genes please click here.


For more information please contact Gary Jones on 0407 047 917 or Stephen Wait on 0438 227 811 to talk about any of the articles covered in this month’s newsletter.

When is the right time to get advice?

As a general rule, it’s never too early and never too late to seek the advice of a professional financial adviser. If you think financial advice is just about helping you to save more for your retirement, think again. No matter where you’re at in life, getting good financial advice can help put you in the best possible place to achieve your life dreams, and protect you should things don’t go to plan.

Here are five situations where it’s more important than ever to seek advice:

  1. Moving in with your partner:

Starting a new relationship can be an exciting time – and it can be easy to get carried away. As you start your life together, your financial adviser can help you plan a new budget, so you can start saving for mutual goals. Your adviser can also make sure you’re both protected with adequate insurance – something that is particularly important if children are involved.

  1. Setting up a new house:

It is acknowledged that buying your first home these days is harder than ever, with property prices at record highs in most Australian cities. Your financial adviser can help you create a realistic plan to save for a deposit, helping you to get your start in the property market.

  1. Ending a relationship:

Not every relationship lasts, and breakups can be painful – and often financially detrimental. Your financial adviser can help you work out how you and your ex-partner can split your shared assets (once you’ve reached an agreement with your ex-partner), including superannuation and the family home. They can also help you to get your finances back on track, reviewing your budget to suit your new situation and lifestyle.

  1. Changing direction:

It seems these days that we change jobs more regularly than previous generations. So if you’re thinking of changing your workplace or embarking on a new career, it’s time to sit down with your adviser. They can help you understand the financial implications of changing employers, working less, or help you make the most of a higher income or promotion. If you are nearing retirement, you may want to discuss a transition to retirement strategy, so you can spend less time in the office and more time at home. If you want to be your own boss, make sure you talk to your adviser about making tax effective contributions to super, so you don’t retire without a nest egg.

  1. Taking time out:

There may be times in life when commitments like parenting, taking care of elderly parents, studying or travelling will take priority over full-time work. If you’re planning on taking a break from work, your financial adviser can help you understand your financial options for funding this time off. Remember that while you’re not working you won’t receive any employer contributions to your super. So it’s important to talk to your adviser to help make sure your retirement savings don’t fall behind.

 

General advice disclaimer

General advice warning: The advice provided is general advice only as, in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.

What is the point of Super?

“What is the point of Super?” asked Dr Watson of Holmes.Sherlock Holmes Deerstalker Hat, Vintage Clock, Retro Magnifier And Smoking Pipe On The Black Table Background. Overhead View. Investigation Concept.

Holmes replied “Quick, Watson, the games afoot”!

This simple question was raised by the Murray Review (financial system inquiry) and the Review suggested that the answer should be “to provide income in retirement to substitute or supplement the Age Pension”.

To put this in context the current annual amount of the Age Pension (single maximum basic rate) is $860.20 per fortnight.

The current Government (that is the Government which is currently in charge until the next Government is in charge) has accepted that the purpose of superannuation should be specified so to be a yardstick (or, for those of a different generation, a millimetre stick) against which policies, proposals and discretions are to be developed, judged and exercised.

Consequently, this simple question is very significant and much will turn upon the answer which is given.

To hedge its bets, the Murray Review also suggested a shopping list of subsidiary objectives for super: some of which are motherhood statements (“Be simple and efficient” and “Be invested in the best interests of fund members”) others are hypocritical (“be fully funded from savings” – as in public servants, political and judicial pensions?) while some are simply Orwellian (“facilitate consumption smoothing”– to be equally improvised while working as being retired? Or to “help people manage financial risks in retirement” – possibly not changing the system would assist with this objective).

What is the outcome of all this?  If the primary objective of superannuation is to substitute for the Age Pension why would any rational taxpayer (voluntarily) participate in the super system?  The rational taxpayer would make no contributions to the system, accept the 9.5% contributions (which cannot be avoided or substituted) and then consume their super as quickly and delightfully as possible when it first becomes accessible – with at all times a strict eye on the asset deprivation rules – to qualify for the full age pension.

If the objective of superannuation is to supplement the Age Pension then a rational taxpayer would again simply, quickly and delightfully consume their super as any non-consumed super will simply reduce their entitlement to the Age Pension by virtue of the means test.

If the purpose of the super system is to “substitute” or “supplement” the Age Pension what is the justification for public servants’, politicians’ and judges’ super systems?  If the purpose of super is simply to “substitute” or “supplement” the Age Pension then those schemes should be terminated (without compensation) and the current participants should welcome their entitlement to the Age Pension.

On a different note if the principal purpose of super is to substitute or replace the Age Pension, then it follows that all super benefits must be taken as income streams – either as super pensions or annuities (or a combination of both).  This would prevent super being used to pay off debt or being used to finance the acquisition of a retirement residence or that end of working life extravaganza.

Such a simple question – which has very significant implications.

 

General advice disclaimer

General advice warning: The advice provided is general advice only as, in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.

My Olympic Journey – Chris Anstey

With the 2016 Rio Olympic games well underway we wanted to take a moment to share the Olympic journey of Chris Anstey, two-time Olympian and the ambassador for our financial body, La Trobe Financial.

In the below video the former Olympian, Chris Anstey, discusses his Olympic Journey.

My Olympic Journey – Blog Post v2

We want to wish the 2016 Australian Olympic Team all the very best in their journey to Rio!

July 2016 Update

What would ‘a better deal’ on health insurance mean for you and your family? Lower premiums? Bigger refunds? The best policy for the things you really need to be covered for? All of the above?

Over the last three years, we have helped many clients find a better deal on health insurance through our no-cost, no-obligation health insurance review service*. Our goal is to make sure you have the right policy at the right price for your needs and circumstances. No more, no less.

If you already have the best policy for your needs and budget, we’ll tell you and that’s that. We won’t sell you a policy or encourage you to swap funds just to make a sale. But we will help with questions like:

  • Am I paying too much?
  • Am I covered for the benefits I really need?
  • My circumstances have changed. Do I need a different policy?
  • Can I avoid the Medicare Levy Surcharge?
  • I’m worried about the Lifetime Health Loading.

Simply click here, answer a few questions and wait for a call from one of our health insurance specialists. It’s free and you’ve got nothing to lose.

This Newsletter looks at how the recent a hung parliament will impact super and property. We explore scams circulating this time of year, and how to keep wealth in your family.

We hope you enjoy this Newsletter, and as always, we urge you to call our office for personal advice if there is any area that you need to discuss.


Hung parliament impact on super and propertyDepositphotos_40449351_m-2015

What a fix we’re in! Just a few weeks ago we were contemplating big changes to super, lower small business taxes and property investors were finally able to rest assured negative gearing was sticking around. Well, that’s all changed since the election, as we could now be facing a hung parliament.

So what does this mean for your finances?

Click here to read entire article.


Don’t let your business data be held to ransomDepositphotos_54650411_m-2015

Ransomware is currently one of the most significant security threats to small businesses in Australia. Criminal gangs spread this malicious software via convincing spam emails to extort payment from the victim.

Click here to read entire article.


Keeping wealth in the familyDepositphotos_32108539_m-2015

For most families, preserving and enhancing the family wealth and passing it on to future generations is a primary goal. There are a number of ways of achieving this, including the use of family trusts.

Trusts can be very powerful tools in protecting and distributing family assets in a tax effective manner.

Click here to read entire article.


For more information please contact Gary Jones on 0407 047 917 or Stephen Wait on 0438 227 811 to talk about any of the articles covered in this month’s newsletter.

Alternatively click here to have one of our team members contact you to discuss your circumstances.

Kind regards,

Stephen, Gary and the team at The Farm Protectors

*This service is provided for The Farm Protectors by ItsMy Health – www.itsmy.com.au. If you participate in this offer, a health insurance specialist from ItsMy Health will contact you on our behalf. The call will be from an 03 (Melbourne) telephone number. If you buy a policy, switch funds or levels of cover, The Farm Protectors may receive a commission from the health fund.

 

Looking for a better deal on health insurance?

What would ‘a better deal’ on health insurance mean for you and your family? Lower premiums? Bigger refunds? The best policy for the things you really need to be covered for? All of the above?Happy family of three lying in the grass in autumn

Over the last three years, we’ve helped many clients find a better deal on health insurance through our no-cost, no-obligation health insurance review service*. Our goal is to make sure you have the right policy at the right price for your needs and circumstances. No more, no less.

If you already have the best policy for your needs and budget, we’ll tell you and that’s that. We won’t sell you a policy or encourage you to swap funds just to make a sale. But we will help with questions like:

  • Am I paying too much?
  • Am I covered for the benefits I really need?
  • My circumstances have changed. Do I need a different policy?
  • Can I avoid the Medicare Levy Surcharge?
  • I’m worried about the Lifetime Health Loading.

Simply click here, answer a few questions and wait for a call from one of our health insurance specialists. It’s free and you’ve got nothing to lose.

 

*This service is provided for The Farm Protectors by ItsMy Health – www.itsmy.com.au. If you participate in this offer, a health insurance specialist from ItsMy Health will contact you on our behalf. The call will be from an 03 (Melbourne) telephone number. If you buy a policy, switch funds or levels of cover, The Farm Protectors may receive a commission from the health fund.

Keeping the Wealth in the Family

For most families, preserving and enhancing the family wealth and passing it on to future generations is a primary goal. There are a number of ways of achieving this, including the use of family trusts.Depositphotos_32108539_m-2015

Trusts can be very powerful tools in protecting and distributing family assets in a tax effective manner.

A trust is an agreement where a person or a company (the trustee) agrees to hold an asset or assets for the benefit of others (beneficiaries). The trustee is the legal owner of the trust asset/assets and the beneficiaries hold the beneficial interest in these assets.

There may be a variety of reasons for using trusts. The use and the structure depend on the purpose of the trust.

The family trust:

  • Is established by a family member for the benefit of members of the family group;
  • Can be subject to a Family Trust Election;
  • Provides protection from potential liabilities (bankruptcy or insolvency);
  • Allows for family assets to pass to future generations in a tax effective manner;
  • Can be a tax effective vehicle by ensuring all family members use their tax-free thresholds for income tax purposes; and
  • Can provide certainty in the event of a family member’s death by avoiding issues such as challenges to the will.

Who may be included in the family group?

Section 272-95 of the Income Tax Assessment Act (ITAA) 1936 sets out the family of an individual (the test individual) as:

   a) Any parent, grandparent, brother or sister of the test individual or the test individual’s spouse;
   b) Any nephew, niece or child of the test individual or the test individual’s spouse;
   c) Any lineal descendant of a nephew, niece or child referred to in paragraph (b);
   d) The spouse of the test individual or of anyone who is a member of the test individual’s family because of paragraphs (a), (b), and (c).

Where:

  • A child includes the individual’s child, adopted child, ex-nuptial child, stepchild, a child of the individual’s spouse, a child of the individual within the meaning of the Family Law Act 1975.
  • A spouse includes current spouse, former spouse, de-facto spouse (whether of the same sex or a different sex).
  • The term lineal descendent includes any descendent of an individual in a direct line relationship flowing downwards, starting with an individual’s child (including an adopted child, stepchild or ex-nuptial child) and extending to include a grandchild, a great grandchild and so on.

In addition, section 272-90(2A) of the ITAA 1936 extends the family group further to include:

   a) A person who was a spouse of either the primary individual or of a member of the primary individual’s family before a breakdown in the marriage;
   b) A person who was a widow or widower (whichever is applicable) of either the primary individual or of a member of the primary individual’s family and who is now the spouse of a person who is not a member of the primary individual’s family; and
   c) A person who was a step-child of either the primary individual or of a member of the primary individual’s family before a breakdown in the marriage of the primary individual or the member of the primary individual’s family.

Types of trust

Generally speaking trusts can be:

  • Fixed;
  • Discretionary; or
  • Hybrid

In a fixed trust, the share that beneficiaries have in assets and income are pre-determined and fixed. This structure does not give the trustee any flexibility in varying income or capital distributions.

An example of fixed trusts can be unit trusts (also known as managed investment funds) where each unit held in the trust represents an entitlement to a certain proportion of income and capital.

The fixed trust is not a very common structure used in family trusts.

A discretionary trust provides the trustee with discretion over the distribution of trust income and capital in accordance with the terms of the trust deed. Discretionary trust structures are very common amongst family trusts due to the flexibility that they offer.

A hybrid trust has characteristics of both fixed and discretionary trusts. An example of a hybrid trust can be a unit trust with discretionary distribution options or a discretionary trust with certain fixed entitlements being fixed by the trust deed.

The use of this structure can be beneficial for specific purposes such as fixing a percentage of entitlement to a particular beneficiary/beneficiaries for a specific reason.

Trusts established for family affairs are usually testamentary or inter vivos trusts.

Testamentary trusts (also known as discretionary will trusts) are established in a will and do not come into effect until the will maker’s death.

In contrast, inter vivos trusts (also known as living trusts) are an arrangement provided by the will and allow the will maker to pass on their assets while still alive.

Note: When the trust income is distributed to a minor (under age 18), the taxation treatment of a discretionary will trust should be distinguished from an inter vivos or living trust. This is explained further in the Financial Planning Opportunities section of this article.

Taxation of family trust income, franked distributions and capital gains

Trust Income: The trustee of the family trust must distribute the taxable income generated by the assets of the trust to the beneficiaries. Income that is distributed to beneficiaries forms a part of the beneficiary’s taxable income and is taxed at their marginal tax rate. Any income retained by the trust (also known as undistributed income) is taxed at the top tax rate of 45 per cent, plus Medicare levy of two per cent, plus Budget Repair levy of two per cent. This gives a strong incentive to family trusts to fully distribute the trust’s income before the end of each financial year.

Franked distributions: Where provided by the trust deed, franked distributions can be allocated to beneficiaries by making them specifically entitled to these distributions. The beneficiary will be taxed on the distribution and also receive the benefit of any franking credits.

Capital gains: Similar to franked distributions, the capital gain generated by the disposal of a trust asset, can be allocated to beneficiaries for tax purposes. This is done via the trust deed by making beneficiaries specifically entitled to it.

Financial planning opportunities

There are a number of advantages in using family trusts including income splitting, asset protection, and estate planning, as outlined below.

   1. Income splitting and distribution of income within family group

When the trust income is distributed to beneficiaries, the trustee must take into account each beneficiary’s financial, taxation and personal circumstances and distribute available income in the most tax effective manner.

When it comes to distributing trust income to a minor, the assessment of income is determined by the type of the trust.

Any income distributed from the living trust to a minor is assessed as “unearned income” and is taxed at “minor tax rates”, which are higher when compared with adult tax rates.

The amount of unearned income that a minor can earn before penalty rates of tax apply is $416. Income over this threshold is taxed at 68 per cent up to $1307, after which income is taxed at 47 per cent and the minor is not eligible for the low income tax offset.

With this in mind, it may be more tax effective to distribute most of the living trust income (if not all) to adult beneficiaries, including senior family members who may be able to take advantage of the seniors and pensioners tax offset.

In addition, beneficiaries with lower taxable income may be distributed more income than those with higher taxable income. The trustee must take these issues into consideration when distributing the trust income to its beneficiaries.

In comparison to living trusts, penalty tax rates do not apply to testamentary will trust income distributed to a minor, which includes assessable income of a trust that resulted from a will, codicil or intestacy, or a court modification of a will, codicil or intestacy (ITAA36 s 102AG).

When this applies, adult tax rates are applied to income distributions paid to a minor and the low income tax offset will also apply.

When combined with a carefully drafted trust deed, income splitting and the distribution of income within the family group can allow for the tax-effective treatment of estate assets and the distribution of the trust income.

   2. Asset Protection

The trustee of a discretionary trust holds assets for the beneficiaries. The trustee does not personally own these assets. As such, the assets held by a person as trustee cannot be taken by creditors in the event of a trustee declaring bankruptcy or insolvency unless the debt relating to the creditors was a trust debt.

In addition, beneficiaries do not own any of the trust assets until such time when the trustee exercises its discretion to make a distribution of assets.

In situations where the debt relating to the creditors is the primary beneficiary’s debt, the trustee would administer the trust fund on the primary beneficiary’s behalf until such time as the primary beneficiary is discharged from bankruptcy or settles other claims against him/her. The primary beneficiary could then assume the trusteeship of the trust.

   3. Estate Planning

One of the main advantages of using the trust structure is that it allows assets of the family to be passed on to future generations in a tax effective manner. This can be arranged while the person is still alive (living trust) or after their death (testamentary will trust).

A testamentary will trust is a trust established after the death of a person. Provision must be made in the deceased’s will to establish the trust.

Testamentary trusts are a useful estate planning tool, particularly where young children are involved as it can help to minimise the tax for the surviving parent or provide management of a child’s inheritance.

As different children may have different needs, it may be worth establishing more than one testamentary will trust. The will can specify that a testamentary trust must be established or allow the executor to decide if it is in the interest of the dependants based on the circumstances at that time.

The following advantages and disadvantages must be taken into consideration when recommending testamentary will trusts:

Advantages of using a testamentary will trust include:

  • Asset protection;
  • Flexibility for the distribution of income and capital (if discretionary);
  • Tax planning as income received by a child will be taxed at adult tax rates;
  • Can restrict access until the child reaches a specified age.
  • Disadvantages of a testamentary will trust include:
  • The cost of establishing and maintaining the trust;
  • The trustee has full discretion and some beneficiaries may not be provided for in accordance with the deceased’s wishes if the trustee favours one beneficiary over another;
  • Loss of control by the beneficiary until the trustee makes a distribution.

Conclusion

The trust structure can be a powerful tool in protecting and distributing family assets in a tax effective manner.

However the establishment and the structure of the trust must be carefully considered and as such professional legal, accounting and financial advice must be sought to ensure that the trust is established and operated in a manner that meets the family needs.

Written by Anna Mirzoyan (technical services consultant at Fiducian).

Don’t let your business data be held to ransom

Ransomware is currently one of the most significant security threats to small businesses in Australia. Criminal gangs spread this malicious software via convincing spam emails to extort payment from the victim.Depositphotos_54650411_m-2015

Ransomware is a type of malicious software (malware) that encrypts (or locks) the files on a computer, making them inaccessible. Once the malware has been downloaded on the victim’s computer, the victim receives a message on their computer screen from the criminal (the ransom note), advising them that their files have been locked, and demanding money in return for unlocking the files.

In 2015, the Australian Competition and Consumer Commission (ACCC) received more than 4,400 reports of ransomware with small businesses and consumers reporting losses of nearly a million dollars as a result.

This figure likely represents only a fraction of the total victims of ransomware, as not all victims are willing to report the crime. Cybercriminals usually demand victims pay the ransom in virtual currencies, such as Bitcoin, which is difficult for law enforcement to trace.

“Several people reported losing over $10,000 to these scams, which can have a devastating effect on a small business,” says ACCC Deputy Chair Dr Michael Schaper. “Ransomware can also see your business losing all of its business and financial records, which may be catastrophic.”

ACCC recommended steps to protect your business from ransomware

  • Do not open attachments or click on links in emails or social media messages you’ve received from strangers – just press delete.
  • If you want to access footage or information about major or breaking news, use a reliable news source rather than an unknown web link.
  • Be wary of free downloads and website access, such as music, games, movies and adult sites. They may install harmful programs without you knowing.
  • Always keep your computer security up to date with anti-virus and anti-spyware software, and a good firewall. Only buy computer and anti-virus software from a reputable source.
  • Use your security software to run a virus check if you think your computer’s security has been compromised. If you still have doubts, contact your anti-virus software provider or a computer specialist.
  • Keep your office networks, computers, and mobile devices secure. Update your security software, change passwords and back up your data regularly. Store your backups offsite and offline. Stay Smart Online explains how to back-up your data (link is external) and secure your mobile devices (link is external).

If you think you have provided your account details to a scammer, contact your bank or financial institution immediately.

We encourage you to report scams to the ACCC via the report a scam page. This helps the ACCC to warn people about current scams, monitor trends and disrupt scams where possible. Please include details of the scam contact you received, for example, a screenshot.

To report a scam please click here.  

Spread the word to your friends and family to protect them.