Question

Jack and Jill are a married couple who run their own SMSF and are its only trustees. They both worked as employee financial advisers. In July 2017, they quit their jobs and moved to Singapore, where they hoped to set up and successfully run their own financial services firm. They planned to live in Singapore for many years and send their children to school there. When leaving Australia, they rented out their Australian home, sold their other Australian assets, and purchased an apartment in Singapore. They enrolled their children in school there. However, their Singaporean business was unprofitable. This was only made worse due to the COVID situation in 2020. As a result, they move back to Australian in June 2020. While in Singapore, they would often have meetings making decisions about the SMSFs investment strategies.   

Discuss whether for the 2019-20 financial year the ‘central management and control’ of Jack and Jill’s superannuation fund was ‘ordinarily in Australia’ for the purposes of s. 295-95 ITAA 1997.

Answer 1

A * superannuation fund is an Australian superannuation fund at a time, and for the income year in which that time occurs, if:

                     (a) the fund was established in Australia, or any asset of the fund is situated in Australia at that time; and

                     (b) at that time, the central management and control of the fund is ordinarily in Australia; and

                     (c) at that time either the fund had no member covered by subsection (3) (an active member ) or at least 50% of:

                              (i) the total * market value of the fund's assets attributable to * superannuation interests held by active members; or

                             (ii) the sum of the amounts that would be payable to or in respect of active members if they voluntarily ceased to be members;

                            is attributable to superannuation interests held by active members who are Australian residents.

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