THEY say you cannot escape death or taxes in life and now the Federal Government wants to introduce "Death Taxes".
According to chartered accountants William Buck director Anna Carrabs, new rules under the Howard Government’s “Simple Super” rules, which take effect from July 1, 2007, are effectively introducing a “death tax” on parents who own property through self-managed superannuation funds.
The little known, new trap involves the inheritance of property, owned by parents’ superannuation funds, by non-dependent children.
On taking possession of the property, the children face the immediate tax liability of up to 16.5% of the property’s value after July – the first time this type of tax has been introduced in
“The introduction of this tax is effectively as a death duty by stealth, as a great proportion of the $21 billion worth of self-managed superannuation funds now own or part-own property,” Carrabs said.
“When the superannuant’s death occurs, the person who inherits the property is immediately liable for the tax.
“This is the first time a tax liability has passed to the next generation or others on property inheritance and people should be working now to make arrangements to deal with this potential financial time bomb,” she concluded.
Australian Property Journal
