A room full of finance professionals tackled tricky case studies at the Challenger Financial Standard Technical Forum in Sydney yesterday afternoon.
Technical services professionals from IOOF and BT Financial Group presented case studies based on two topics: distributing capital gains tax exempt proceeds out of a company structure and aged care.
The audience of about 50 included technical services managers, compliance officers, professional standards officers, analysts, paraplanners and a few financial advisers and planners.
IOOF senior technical services manager Linda Bruce presented the audience with a challenging case study - calculate the capital gains taxes for a musician couple's business through a 25 year lifecycle.
The audience had to make tradeoffs while claiming specific SBCGT concessions: 15-year exemption, 50% active assets reduction, and retirement emption and rollover relief as the couple's company passed through various stages and they transitioned in retirement.
As an example, while calculating if it was wise to claim a 50% active assets reduction nine years into the company's life when the couple aged 50 and 55, Bruce encouraged the audience to consider if the company might make future gains, and if the company needed to retain as much working capital as possible if the retirement exemption were to be used in the future.
The next session by BT Advice Capability & Conduct senior technical specialist Janet Manzanero-Caruana looked at aged care case studies involving couples.
One of the challenges she presented to the audience was to figure out if a couple's situation made them "illness separated couple".
The Age Care Act doesn't define what qualifies as an "illness separated couple" and cases are assessed individually, she said.
Other areas she covered included: pension loan scheme versus reverse mortgages, accommodation supplements for low means residents based on the building's condition, treatment of life interest as a home, accommodation costs when a couple co-habitates a single room in same facility.
Wrapping up the forum, Janet reminded the audience technical services is not just about making calculations but about asking the right questions, exploring client circumstances, seeking other options, and educating and preparing clients.