What is it?
The Special Disability Trust (SDT) is a trust structure established to provide for a person with severe disability.
The benefit using SDT:
Concessional for means tested for Government Pension like Aged Pension or Carer Pension
- Gifting Concession for eligible family member who donates to the SDT (up to $500,000)
- Asset Test Exemption for beneficiary of the SDT. Up to $647,500 as at 1st July 2016
The amount is indexed annually. - Income Test Exemption for beneficiary of SDT of all trust income.
Taxation
- Capital Gains Tax exemption for asset donated into the SDT
- Unexpended Income of the SDT taxed at the beneficiary personal income tax
rather than at the highest marginal tax rate
Steps to establish the SDT
- Receive approval from the Department of Human Services that the beneficiary qualified
- Obtain the Model Trust Deed
- Establish at Trust
- Donation the asset to the Trust
- Invest
Ongoing
- Payment of income from the Trust to the beneficiary
- Preparation of financial statement as at the 30th June every year by a qualified accountant
- Keep records of expenditure if audited
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