Financial dependency is established under the ITAA 97 where a person provides a better standard of living to another person on a regular and continuing basis. Many parents provide for their adult children and the adult child’s family on an ad hoc basis.
The Family Allowance agreement formalises the relationship between the parties which may substantiate and evidence the matter of financial dependency.
- It is simple and easy to use and a matter to be discussed between parents and their adult children.
- It is not a loan but a true family allowance.
- The payments are monthly and continuous in order to establish true financial dependency.
- Can be made to one individual or a family.
Frequently Asked Legal Questions
What is the Family Allowance to be used by the Family for?
The Provider provides a regular family allowance payment as detailed below for the purposes of looking after their Family for, amongst other things the following purposes:
- Paying for school fees;
- Buying clothes for all the Family;
- Providing funds for acquisition of food and services;
- Providing funds for any other purpose to enhance the life, experience and comfort level of all members of the Family.
Do payments need to be regular?
Any family allowance payments need to be regular, monthly and continuous.
How much is the monthly payment?
The payment needs to be meaningful and not a token payment to show dependence. The recipients must show that they relied on the payment to provide an enhanced standard of living. If the child is already on significant income dependency cannot be established.
What lawyers sign off on the Family Allowance?
All LightYear documents are prepared and signed off by TGA Legal from Melbourne, Sydney and Brisbane.
Is there any training on the LightYear Docs Family Allowance?
We have specialist Family Allowance training in the Support Section on www.lightyeardocs.com.au
Do you have details on the LightYear Docs Family Allowance that I can give my clients?
We have a video with Grant Abbott, explaining “The benefits of providing strong and secure SMSF estate planning with a Lightyear Docs SMSF Estate Planning package and leaving a legacy for the Family.” Please visit ilovesmsf.com or email email@example.com
Is the LightYear Docs Family Allowance Agreement reviewed regularly?
All LightYear Docs documents form part of the LightYear Docs internal document review cycle. All documents are scheduled to be reviewed at least annually or when required to do so due to changes in legislation. The LightYear Docs review cycle ensures all of our documents remain current and accurate.
Can this document be digitally signed?
NOT RECOMMENDED. As this document, or pack of documents, includes the establishment of a deed and/or a signature requires witnessing, TGA Legal have advised that a digital signature on any part of the assembled document is NOT legally binding. This is in accordance with all current legislation. LightYear Docs will regularly review this position as part of its internal review process.
What happens after I purchase this document?
After you purchase this document, you will experience first-hand the power of our assembly engine, HotDocs. An interview session will appear in what is called the HotDocs iFrame. Through the use of the iFrame technology, we are able to create document templates in minutes, versus months of coding through other methods. The iFrame also allows for rapid integrations and documentation to be assembled instantly in "lines" or packs of documents.
Can I edit my document after it has been completed?
Your document will be available to edit from the LightYear Vault for 30 DAYS after you have completed the interview process, at which point it will be locked for future edits. Your completed documents will be listed under "My Vault" from the drop-down menu in the top right-hand corner after you login. This is also where you re-launch an "interview" to make edits within the first 30 DAYS.
Can I save a document to complete later?
Yes, provided you select save, you can exit the interview process at any time. All documents that have been purchased and not yet assembled will be saved under "My In Progress Docs" and are accessible from the drop-down menu in the top right-hand corner after you login. This is also where you re-launch an "interview" to continue the interview process and assemble your document.