Bryce Figot, special counsel for DBA Lawyers, said one of the first things to do before 1 July 2026, when Div 296 begins, is \u201cnothing\u201d.<\/p>\n
\u201cI don\u2019t think anyone is going to need to majorly restructure. In other words, don\u2019t just do something. Stand there. I know under the previous iteration, people were really talking about what they needed to do to prepare for the introduction of this tax but that\u2019s under the previous iteration,\u201d he said.<\/p>\n
\u201cI think really for this iteration, it\u2019s far more gentle even though there are some headline tax changes, particularly for those above $10 million. However, I suspect it will be very unlikely that you\u2019d need to do any major restructuring.\u201d<\/p>\n
He continued, however, there are strategies that might involve proactive actions including ensuring equal balances.<\/p>\n
\u201cFor example, between a husband and wife, try to ensure that they have equal balances even if, currently, they are both well below $3 million and even though that $3 million threshold will be indexed,\u201d he said.<\/p>\n
\u201cEven for a relatively young couple with a relatively modest balance, try to ensure that they have equal balances. That\u2019s a good strategic tip for the Div 296 as well as for lots of other reasons including the transfer balance cap regime.\u201d<\/p>\n
Figot said before 1 July 2026 trustees should examine assets with unrealised capital losses but be very careful not to engage in a \u201cwash sale\u201d.<\/p>\n
\u201cI do wonder if people will wish to examine assets with unrealised capital losses, and you might wish to cherry pick the selling of certain assets,\u201d he said.<\/p>\n
Another strategy concerns automatically reversionary pensions which he said are \u201cless attractive\u201d.<\/p>\n
\u201cConsider changing to non-reversionary,\u201d he added.<\/p>\n
He continued that strategy number five is about market valuations, and he noted the lower market valuations are the better.<\/p>\n
\u201cThey probably result in a lower tax liability. Under the previous iteration [of the Div 296 tax], people were saying they wanted to have a high-market valuation before the Div 296 starts,\u201d he said.<\/p>\n
\u201cUnder this regime, however, lower market valuations are better.\u201d<\/p>\n
Figot said from 1 July if a client does receive a Div 296 liability they should pay it from a super interest with a high taxable component.<\/p>\n
\u201cStrategy seven, you might want to think about adding new members,\u201d he said.<\/p>\n
\u201cAnd finally, strategy eight, if an SMSF owns units in a unit trust, if the unit trust is going to sell the underlying real estate in that same financial year, try to dispose of the units or wind up the unit trust.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Bryce Figot, special counsel for DBA Lawyers, said one of the first things to do before 1 July…\n","protected":false},"author":2,"featured_media":300419,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[72,176,61,60,16136,174,175,4627],"class_list":["post-300418","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-finance","tag-ie","tag-ireland","tag-legislation","tag-personal-finance","tag-personalfinance","tag-superannuation"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/300418","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=300418"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/300418\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/300419"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=300418"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=300418"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=300418"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}