IF you get Centrelink payments, you may have received a questionnaire on trusts and private companies which must be answered by the end of April.
Centrelink is trying to see if you have any control of a trust or private company and will use the information to “look through” the entity to assess its assets against your pension entitlement.
This “look through” will happen from January 1, 2002, and Centrelink believes that many social security recipients will lose or have their benefits reduced as a result
So what is a private trust?
For Centrelink, a private trust must have less than 50 members and includes family trusts, testamentary trusts and fixed trusts. And “control” means the person:
l Is an appointor, guardian or principal of the trust,
l Is a trustee.
l Is a shareholder or director of the trustee company or
l Is a beneficiary or means to benefit from the trust
l Is a unit holder
l Is owed money by the trust
l Has provided property or services to the trust since May 9, 2000 for less than market value,
l Has the ability to direct the trustee or appointor of a trust
What is a company to Centrelink?
Anyone meeting two out of the following three criteria for the last financial year:
l Gross operating revenue, including subsidiaries of under $10 million.
l Total assets, including subsidiaries of under $5 million.
l Less than 50 employees in total, including subsidiaries.
And you're likely involved or in control of a company if you:
l are a shareholder, director or office holder
l provided property/services after May 9, 2000 for less than market value,
l can benefit from the company in some way or are owed money by it
l can direct its director, directors or major shareholders.
What must you do?
Contact your financial adviser if you:
l have a relationship with a trust or private company; and
l feel this may affect your Centrelink payments from January 1, 2002.
