The Victorian Government’s final Occupational Health and Safety (Psychological Health) Regulations 2025 (Vic) (Regulations) came into force on 1 December 2025 – a milestone moment for workplace wellbeing.

While earlier drafts of the Regulations proposed obligations on employers to maintain written prevention plans and report certain hazards to WorkSafe, those provisions were dropped in the final version. However, this doesn’t mean complacency is an option. WorkSafe Victoria still strongly recommends using the prevention-plan template developed during the drafting process to provide structure, transparency and minimise the risk of psychosocial hazards.

Importantly, these Regulations are now a standalone instrument – a new legal requirement that exists alongside the traditional Occupational Health and Safety Regulations 2017 (Vic). Awareness of both is essential to avoid compliance gaps.

What Employers Must Do Now

Eliminate or Minimise Psychosocial Risks

Employers are now explicitly required to identify and eliminate psychosocial hazards wherever possible. If elimination isn’t “reasonably practicable,” the employer must reduce the risk by modifying work design, systems and management structures. Then and only then, as a last resort, through training or information.

Know the Hazards

A ’psychosocial hazard’ is defined as any factor in:

  • the work design;
  • the system of work;
  • the management of work;
  • the carrying out of work; or
  • personal or work-related interactions,

that may arise in the working environment and may cause an employee to experience one or more negative psychological responses that create a risk to their health and safety.

Psychosocial hazards include but are not limited to:

  • bullying, violence, or harassment;
  • exposure to traumatic incidents;
  • poor job design: excessive demands, insufficient control, low reward, or unclear roles;
  • inadequate environmental conditions or poor management of change; and
  • lack of support, dysfunctional relationships, or staff working remotely or in isolation.

These hazards can trigger cognitive, emotional, behavioural, and even physiological responses that threaten health and safety.

Continuous Risk Management

There is a hierarchy of measures which employers must comply with. In the first instance, an employer must eliminate the risk. However, if it is not reasonably practicable to eliminate the risk, the employer must reduce the risk as far as reasonably practicable by altering the management of work, systems of work, work design or workplace environment. If the risk cannot be reduced by altering these systems, then the employer must use information, instruction or training to reduce the risk as far as reasonably practicable.

Employers must regularly review and revise controls under multiple scenarios:

  • before implementing changes to work processes;
  • when new hazards or injury reports arise;
  • following any incident involving a psychosocial trigger;
  • if existing measures prove ineffective.

WorkSafe can require Employers to review or update control strategies if safeguards aren’t kept up to date or robust. WorkSafe has released a Compliance Guide on managing risks to psychosocial hazards to assist employers in complying with the Regulation.

Why Employers Should Seek Advice

  • Navigate complexity: New standalone rules mean your existing OHS systems and processes may no longer be enough.
  • Stay ahead of WorkSafe: The recommended template provides employers with a defensible baseline for compliance. However, employers should ensure that risk management frameworks are tailored to unique hazards in their workplace having regard to their operations, environmental conditions, leadership capability, culture, sector and known issues.
  • Protect your people and your reputation: Early detection and mitigation of psychosocial risks can reduce legal and operational exposure, as well as employee distress and turnover.

Next Steps for Employers

  • Review your systems: Identify potential psychosocial hazards in your workplace.
  • Use prevention tools: The template remains a best-practice resource.
  • Embed change: Align your work systems with the Regulations’ hierarchy: eliminate, reduce, then inform.
  • Plan reviews: Schedule reviews both routinely and in response to incidents or changes.
  • Consult your adviser: Get tailored guidance from an OHS professional or legal advisor to ensure full compliance and best practice.

WorkSafe Victoria’s guidance on managing risks to psychosocial hazards is a useful starting point but with so much at stake, expert advice isn’t just prudent, it’s essential. Employers who take a strategic, informed approach to psychological safety now will build stronger, healthier, more resilient workplaces, and shield themselves from future legal or regulatory risk.

How we can help

Moores can assist employers to amend their risk management frameworks to ensure that they effectively identify and mitigate psychosocial hazards, including occupational health and safety policies and procedures, training for senior leaders on identifying and managing psychosocial hazards, and implementing plans to minimise risks as far as possible.

For more information on the reforms, watch our webinar Psychosocial Hazards in the Workplace.

Contact us

Please contact us for more detailed and tailored help.

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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisation.

Owners of residential property in Victoria may be required to lodge a Vacant Residential Land Tax (VRLT) notification if their property was vacant for six months or more during the 2025 calendar year.

If you own a residential property in Victoria which was vacant for six months or more during the period from 1 January 2025 to 31 December 2025, a VRLT notification for that property must be lodged with the State Revenue Office by no later than 15 February 2026.

Notifications must be made via the SRO’s online VRLT portal.

Importantly, a notification must be submitted even if you believe that the property is exempt from VRLT (for example, it was used as a family holiday home and it qualifies for the exemption). In that case, the exemption is claimed when the notification is made.

VRLT Exemptions

The only exception to the notification requirement is if a VRLT notification was lodged for 2025 claiming an exemption, that exemption application was approved, and the use of the property has not changed (ie. it still qualifies for that same exemption).

How we can help

To find out more about whether VRLT applies to your property – and whether an exemption could possibly apply – use our self-assessment tool.

Contact us

To discuss your specific situation or for assistance with lodging a notification or claiming an exemption, please contact us.

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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisati

On 9 December 2025, the Office of the Australian Information Commissioner (OAIC) announced it will be launching into the new year with significant momentum with plans to undertake its first ever privacy compliance reviews.

Who is the OAIC targeting?

Starting in the first week of January 2026, the OAIC’s targeted review will assess 60 entities across six sectors engaging in ‘in person’ collections of personal information privacy practices against the requirements under the Australian Privacy Principle (APP) 1.

The six sectors include:

  1. Rental and property – collection of individuals’ personal information during property inspections;
  2. Chemists and pharmacists – collection of personal information for the purpose of providing a paperless receipt and collection of identity information to provide medication;
  3. Licensed venues – collection of identity information to enable individuals to access a venue;
  4. Car rental companies – collection of identity and other personal information to enable an individual to enter into a car rental agreement.
  5. Car dealerships – collection of personal information to enable an individual to conduct a vehicle test drive; and
  6. Pawnbrokers and second-hand dealers – collection of identity information from individuals who wish to sell or pawn goods.

Requirements of APP 1 – Pulse checking your Privacy Policy

The OAIC’s announcement is a timely reminder to ensure that your Privacy Policy is clear, accessible up to date and captures any changes to personal information handling practices as we head into 2026.

A key element of the review is the OAIC’s assessment of how these selected APP entities are complying with APP 1.4 which sets out items which must be included in your Privacy Policy to be compliant. The information required includes:

  • the kinds of personal information that the entity collects and holds;
  • the purposes for which the entity collects, holds, uses and discloses personal information;
  • how an individual may access personal information about themselves that is held by the entity and seek the correction of such information;
  • how an individual may complain about a breach of the Australian Privacy Principles, or a registered APP code (if any) that binds the entity, and how the entity will deal with such a complaint;
  • whether the entity is likely to disclose personal information to overseas recipients; and
  • if the entity is likely to disclose personal information to overseas recipients – the countries in which such recipients are likely to be located if it is practicable to specify those countries in the policy.

Key takeaways

The Commissioner has power to conduct an assessment relating to the Australian Privacy Principles (under S 33C of the Privacy Act 1988 (Cth)). The January 2026 sweep is indicative of a move toward exercise stronger enforcement powers and a shift in the OAIC’s regulatory approach.

How we can help

The Privacy and Data Security team at Moores can help you to proactively review your privacy practices including by ensuring your organisation has an up-to date privacy policy and   undertake  privacy audits.  .

Stay tuned for our New Privacy Toolkit, to be released in early 2026.

Contact us

Please contact us for more detailed and tailored help.

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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisation.

Moores is pleased to share that our Practice Leader and Head of Education, Cecelia Irvine-So, has been recognised in the Herald Sun’s Victorian Education Power Rankings.

Described as a “major legal player behind the scenes”, Cecelia is acknowledged for her work supporting schools to navigate complex challenges, strengthen governance and create safe, thriving environments for students.

Moores is privileged to work alongside non-government schools across Victoria and Australia, supporting their ongoing impact on young people and their communities.

Under Cecelia’s leadership, our education practice continues to be sector-leading and trusted by schools seeking clear, practical and values-driven guidance.

Contact us

Please contact us if you would like further information on how we can assist.

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This month, the Australian Competition and Consumer Commission issued three recall notices following the detection of asbestos in imported coloured and decorated sand products used by children for play and craft activities. These products have been sold by major retailers including Kmart and Officeworks throughout Australia between 2020 and 2025.1

The presence of asbestos in any product used by children will understandably cause concern, noting that the current government guidance is that risk is low.2 While school and early learning centres (ELCs) are focused on the operational response, it is equally important that they take steps now to ensure comprehensive, well-maintained records. Asbestos-related claims typically arise many years — even decades — after initial exposure. Without adequate documentation, it may be difficult in the future to ascertain the level and nature of potential exposure as well as whether reasonable steps were implemented to address risk at the time the risk was identified.

A dual focus is therefore essential:

  1. Immediate safety and remediation, and
  2. Long-term, reliable record-keeping to protect the organisation, staff, and students into the future.

What we know so far about the potential asbestos contamination

The response has varied across states as regulators and agencies respond to the recall. Schools in the ACT, Tasmania and Brisbane have closed for disposal and deep cleaning. In Victoria, the Department of Education has responded but has not indicated any plans for school closures.  The Australian Department of Health, Disability and Ageing has issued interim advice in response to the recall immediately advising consumers to:

“Stop using affected products, follow recall instructions, and await further advice. Current risk is low; no clinical checks needed.”3

For the workplace and school environment, Asbestos in Victoria and WorkSafe Victoria have also provided information here.

What is the legal risk?

This recall identifies occupational, health and safety, and duty of care risks.

Taking a conservative approach, schools and ELCs should treat the recall notice as an alert to the potential for a reasonably foreseeable risk of harm requiring a risk response in line with the school’s own risk management framework and risk assessment process.

This means that schools and ELCs must act to eliminate or reduce the risk as far as possible in the workplace and learning environment.

Managing the risk response

In managing any response, schools and ELCs have a primary duty to ensure the safety of students, educators, and families by removing affected products from use and following health authority advice.

Once these immediate risks have been addressed, it is crucial not to overlook the long-term implications. While health authorities assess the risk as low, it is appropriate to collate and preserve any documentation that could assist to respond to possible future questions, reviews, or claims.

The following are some of the steps can support documenting any risk management response (in addition to immediate safety and remedial action):

  • document the recall on the school/ELC risk register
  • assess and record the level of use in the workplace and school or ELC environment (see: What should you document now?)
  • report on the school/ELC’s response to relevant management and governance committees within the school
  • communicate with the school community –parent notifications about the school’s response will ameliorate any reputational risk or perceived shortcomings in your response. Transparency, clear communication with parents, and proactive safety measures will be crucial in maintaining community trust.

What should you document now?

Moores recommends that schools and ELCs collate and keep the following (if and to the extent that this information is available) for any coloured or kinetic sand products currently or recently in use:

Product documentation

  1. Photographs of the product and packaging where it is safe to do so, including packaging, labels, safety instructions, batch numbers, barcodes and product names.
  2. Purchase Information including date of purchase and supplier – this may be on invoices, receipts or purchase orders.
  3. Any correspondence with suppliers regarding product safety or recall notifications.

Action documentation

  1. A clear timeline of risk management actions taken by the school or ELC.
  2. Teacher and staff training on how to handle or identify products that could potentially be contaminated, even after the initial recall.
  3. Remediation and disposal records.

People and situational documentation

  1. Teacher statements to capture first hand recollections of when and how the product was used in the educational environment.
  2. Records of where the produce was used in the educational environment, including a sketch map if appropriate.
  3. Lists of who may have may been present in rooms during the period in which the product was used, including students, staff, volunteers and visitors.

What about retention of records?

Schools and ELCs should retain related records in line with:

  • retention periods under the Occupational Health and Safety Act 2004 (Vic) for near misses and notifiable incidents (i.e. at least 5 years after the serious near miss or incident occurs);
  • retention periods having regard to the limitation periods for personal injury claims, noting that students can bring a claim once they are of mature age; and
  • the organisation’s own records management and retention policy and schedules.

Stay informed

Given the recall, ELCs and schools must act quickly to protect the health and safety of students and staff, and to keep their communities informed.  At the same time, it is critical to establish a comprehensive documentation process that ensures you are well prepared should any claims arise in future.

Moores will continue to keep the sector informed. You can stay updated by subscribing to receive updates on this issue.

Contact us

Please contact us for more detailed and tailored help.


Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisation.

  1. Customers warned of recalled children’s sand due to asbestos risks | ACCC. ↩︎
  2. enHealth Interim Advice – Asbestos contamination identified in imported coloured sand products | Australian Government Department of Health, Disability and Ageing ↩︎
  3. enHealth Interim Advice – Asbestos contamination identified in imported coloured sand products | Australian Government Department of Health, Disability and Ageing ↩︎

From 1 January 2026, a new mandatory and suspensory merger control regime (the Regime) under the Competition and Consumer Act 2010 (Cth) (the CC Act) will apply to significant asset transfers, acquisitions and mergers. Not-for-profits (NFP) and charities acquiring assets or taking over another entity may need to seek ACCC approval for the transaction if certain threshold requirements are met.

What is the Regime and why does it matter to NFPs and charities?

The Regime1 establishes a mandatory notification obligation from 1 January 2026 for certain ‘acquisitions’ that meet prescribed thresholds. These ‘acquisitions’ cannot be effected until the Australian Competition & Consumer Commission (ACCC) has granted approval. This requirement will also apply to merger agreements entered into before 1 January 2026 that are completed on or after that date.

Under s 50 of the CC Act, an ‘acquisition’ of shares2 or assets3 that would or is likely to substantially lessen competition in a market may be prohibited. The ACCC looks at factors such as market concentration, barriers to entry and whether the acquisition removes an effective competitor to determine whether the acquisition would substantially lessen competition.

When would an ‘acquisition’ by an NFP or charity need to be notified to the ACCC?

An acquisition that is connected with Australia (e.g. the target carries on business in Australia or holds assets used in an Australian business) must be notified if it meets certain financial thresholds set by Ministerial Determination4. These are based mainly on revenue and asset value. In summary, an ‘acquisition’ by an NFP or charity5 would need to be notified to the ACCC in the following circumstances:

  • Large Entity or Group: Notification is required if the combined Australian revenue of the merging parties is $200 million or more, and one of the entities involved has Australian revenue of $50 million or more (or assets valued at $250 million or more).
  • Very Large Group: Notification is required if the acquiring group’s Australian revenue is $500 million or more, and the target’s Australian revenue is $10 million or more.
  • Serial Acquisitions: Smaller acquisitions made over a three-year period may also trigger notification if, considered together, they reach the above thresholds. A revenue threshold still applies to each acquisition of $2m. This three-year period could include acquisitions prior to 1 January 2026.

Even if the thresholds are met, notification may not be required in relation to:

  • internal restructures within the same group of entities;
  • acquisitions in the ordinary course of business (not involving land or patents); or
  • acquisitions that do not result in a change in control.

Further, parties may apply to the ACCC for a notification waiver (available from 1 January 2026) which removes the obligation to notify. The ACCC has indicated it will provide further information about waivers later in 2025.

What are the options for an NFP or charity who is required to notify the ACCC?

Organisations that are planning to merge and are required to notify have three options:

  • Before 31 December 2026: early voluntary notification under the new regime
    Organisations can notify now as if the Regime is in force (the ACCC will assess the notification as if the Regime already applies);
  • Before 31 December 2026: informal merger review under the old pre-2026 regime (may no longer be available)
    If an organisation applies and the ACCC approves the merger before 31 December 2025, then the acquisition can proceed but must be completed within 12 months of approval. If the ACCC review is not completed by 31 December 2025, the informal merger review will be discontinued and the acquisition must be notified under the Regime. As the ACCC has advised that requests for informal review received after October 2025 may not be completed before 31 December 20256, there is a significant prospect that this option is already or will soon be unavailable.
  • After 31 December 2025: notify under the Regime.

What is the notification and review process under the Regime?

Broadly, the Regime includes provision for:

  • Pre-notification discussions with the ACCC. These early, confidential discussions are intended to help identify any competition concerns early. Early notification can be completed through the ACCC portal.
  • Notification waiver. As noted above, parties may apply to the ACCC for a notification waiver (available from 1 January 2026) which removes the obligation to notify. The ACCC has indicated it will provide further information about waivers later in 2025.
  • Formal ACCC notification. This will be either short form notification7 (for straightforward acquisitions that are less likely to raise competition concerns) or long form notification8 (for acquisitions raising greater competition risks or complexity). For all submissions, parties must provide information including: details on the business activities and financial information (e.g. revenue) of all parties; information defining the relevant market(s), key competitors, and customers; documentation regarding prior deals put into effect over the preceding three years (to enable assessment of serial acquisitions as discussed above); and if using the long form, any Board documents (including papers, presentations, and reports) that analyse the acquisition’s rationale, valuation, and competitive dynamics of the market.
  • ACCC assessment. This is a staged process involving:
    • initial assessment (Phase 1 – $56,800);
    • where competition concerns are identified, potential further assessment (Phase 2 – $855,000 to $1,595,000); and
    • where there is substantial lessening of competition and the application would otherwise be refused or approved with conditions, a consideration of net public benefit (Public Benefits Application – $401,000).    

What are the consequences of non-compliance?

If a notifiable acquisition is completed without ACCC approval, the ACCC can void or stay the transaction. It would also be a contravention of the CC Act to:

  • proceed with a stayed merger,
  • fail to comply with conditions imposed by the ACCC on an acquisition approval; or
  • provide the Commission with information that is false or misleading.

Penalties for non-compliance are significant, being the greatest of: $50 million; three times the value of the benefit gained (if the benefit is determinable); or 30% of the entity’s adjusted turnover during the breach period (if the benefit is not determinable).

What are practical action steps for NFP and charity boards contemplating a merger?

  • Consider whether notification is required in relation to proposed acquisitions
  • Seek early advice and consider engaging with the ACCC confidentially to ascertain if notification is likely to be required
  • Budget for compliance including ACCC fees if the transaction will be notifiable
  • Prepare supporting documentation early including beneficiary/participant impact assessments, competitor analysis, and transaction rationale
  • Stay informed and monitor emerging ACNC guidance as the Regime is further developed

Conclusion

The Regime represents a significant regulatory shift for NFPs and large charities that are involved in large or regular merger transactions. Proactive engagement with the ACCC, early advice and strategic planning will position your NFP or charity to avoid surprises and ensure compliance with the Regime.

How we can help

Moores Charity and Not-for-Profit team can work alongside you to prepare your board, assess merger readiness and liaise with the ACCC to ensure your organisation is well positioned for Regime compliance.

Contact us

Please contact us for more detailed and tailored help.

Subscribe to our email updates and receive our articles directly in your inbox.


Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisation.

  1. The Regime was implemented via the Treasury Laws Amendment (Mergers and Acquisitions Reform) Act 2024 (Cth), which amended the CC Act. The amendments to the CC Act are also supported by Ministerial Determination and the Merger Process Guidelines. ↩︎
  2. The definition of ‘assets’ is expansive, including legal or equitable interests in tangible or intangible assets, property, land, goodwill, and intellectual property rights. A transfer of assets from one merger partner to another (typically followed by the deregistration of the transferring partner) will be an ‘acquisition’ of assets. Similarly, a transfer of control involving the acquisition of member rights (such as where the acquiring entity becomes sole member of the target entity) will also be an ‘acquisition’ of assets. ↩︎
  3. The CC Act refers to ‘shares’ in the capital of a body corporate or corporation. This will include shares in a proprietary limited company or company limited by shares, but does not include member rights in a company limited by guarantee. ↩︎
  4. Competition and Consumer (Notification of Acquisitions) Determination 2025 ↩︎
  5. A share acquisition is less likely for an NFP or charity. ↩︎
  6. https://www.accc.gov.au/business/mergers-and-acquisitions/informal-merger-review-process ↩︎
  7. https://www.accc.gov.au/system/files/notification-proposed-acquisition-short-form-july-2025.pdf ↩︎
  8. https://www.accc.gov.au/system/files/notification-proposed-acquisition-long-form-july-2025.pdf ↩︎

What is a Special Disability Trust?

A Special Disability Trust (SDT) is a specific form of trust commonly used for beneficiaries who meet the statutory definition of “severe disability” under the Social Security Act 1991 (Cth) (‘Social Security Act’)1. It is designed to provide financial support for care, accommodation and long-term welfare of an eligible beneficiary, commonly designated as a “Principal Beneficiary” while preserving the beneficiary’ entitlement to social security benefits, including the disability support pension. SDTs are frequently employed in succession planning, as they allow assets to flow seamlessly from the deceased estate into a protected legal structure for the ongoing benefit of the disabled beneficiary beyond the lifetime of parents or carers and finally to the residuary beneficiaries in accordance with the wishes of the donor(s).

Tax advantages of an SDT

The taxation regime applicable to SDTs further enhances their financial utility. Once an SDT is validly established with an eligible Principal Beneficiary, the Principal Beneficiary is deemed to be presently entitled to the income of the trust during their lifetime2, and the trustee is assessed on the net income of the trust (including capital gains) at the Principal Beneficiary’s marginal tax rate3. This ensures that the trust’s income is taxed at Principal Beneficiary’s marginal tax rate rather than at the penalty rates otherwise assessed to the trustee.

Further, any capital gain from a transfer of a capital gains tax asset to a SDT or a trust that becomes a SDT as soon as practicable after the transfer, is disregarded. In many jurisdictions, stamp duty relief is also available for eligible transfers.

Estate Planning and Asset Protection Advantages

From an estate planning perspective, SDTs serve as a secure, transparent, and enduring mechanism for protecting the welfare of individuals with severe disabilities. The trust structure ensures that the assets are used solely for the reasonable care and accommodation for the principal beneficiary.

The SDT also enables continuity of financial support and care beyond the lifetime of parents or carers, providing families with peace of mind that their loved one’s future needs will be met. Furthermore, the terms of the trust may specify how residual assets are to be distributed upon the death of the principal beneficiary.

So what’s the catch?

Apart from the highly restricted eligibility criteria, limited ability on use of funds outside of care and accommodation needs of the Principal Beneficiary – i.e discretionary spending limited to $14,750 per annum (as at 1 July 2025) and stringent compliance rules to operate, we have also seen a common theme of certain uncertainties arising in relation to SDTs as to:

  1. what would happen to the funds in the SDT when the Principal Beneficiary has died;
  2. how any income derived by an SDT post Principal Beneficiary’s death is assessed, and
  3. who pays the tax and at what rate.

Consequences of Principal Beneficiary’s death

An SDT generally terminates upon the death of the principal beneficiary or when the trust’s funds are fully expended. At that point, the trust immediately ceases to qualify as a SDT under the Social Security Act.

Upon termination, the SDT ‘vests’, and the principles applicable to trust vesting should apply. ‘Vesting’ refers to the vesting of an interest rather than a position. An interest is regarded as having vested when:

  1. the beneficiaries or transferees have been ascertained4;
  2. all conditions precedent to the creation or transfer of the interest have been satisfied5; and
  3. in the case of a class gift, the quantum of each beneficiary’s share has been determined6.

Vesting of Special Disability Trusts

The vesting of an SDT does not automatically result in the termination of the trust or the creation of a new trust. Vesting merely signifies that the beneficiaries’ interests have become fixed, not that the trust has ceased to exist7. In Taxation Ruling TR 2018/6: Income tax – trust vesting – consequences of a trust vesting, the Commissioner takes the view that where a trustee continues to hold property for takers on vesting, the property is held on the same trust as existed pre-vesting, albeit the nature of the trust relationship changes. The trustee’s role transitions from a duty to properly consider whether to distribute the net income of the trust in accordance with the discretionary power of appointment, to a duty to hold the whole of the capital and income for the benefit of the relevant beneficiaries.

Vesting itself does not compel the immediate transfer of trust property, however, beneficiaries are entitled to call for the transfer of the trust assets as soon as practicable once their interests become fixed8.

Upon vesting, the SDT’s assets vest in accordance with the terms of the trust deed – i.e in the residual beneficiaries specified in the trust deed, in the proportions nominated by the donor(s). This nomination can generally be found in Schedule B of the model SDT deed as prescribed pursuant to the Social Security Act.

Assessment of income upon vesting

From a taxation perspective, upon vesting, the special tax concessions afforded for SDTs cease to apply, and any income derived by the trust post Principal Beneficiary’s death is taxed under general trust taxation rules in Division 6 of Income Tax Assessment Act 1936 (Cth) (‘ITAA36’). This means the assessment of any income derived post Principal Beneficiary’s death will depend on whether there is any present entitlement to the trust income.

By way of an example, if an SDT was established under a Will, and the donor has nominated the funds back to his or her estate upon the death of the Principal Beneficiary, it could be that the estate account is reopened, and the funds are distributed as part of the estate. As no beneficiary can be presently entitled to income of an estate until it has been fully administered – i.e the residual amount can be ascertained after all debts, expenses, and liabilities are satisfied9, the trustee is likely to be assessed either under section 99 or 99A of the ITAA36 depending on whether the Commissioner is of the opinion that it would be unreasonable that section 99A should apply10.

Once the residual beneficiaries acquire a vested interest in the remaining trust assets and income, the relevant beneficiary or the trustee, in case of residual beneficiaries who are non resident or under a legal disability, will be taxed on their respective share of the trust income at their individual marginal tax rate11.

Alternatively, if the donor has directed the funds in the SDT directly to named beneficiaries as opposed to the estate, the interests of such beneficiaries should become ‘vested’ upon Principal Beneficiary’s death and the trustee of the SDT should hold the funds on trust for those beneficiaries until the distributions are made and the trust is wound up. In this scenario, any trust income derived post vesting should be made presently entitled to the residual beneficiaries together with the trust fund in the proportions as nominated by the donor and the beneficiaries will be taxed on their respective share of the trust income at their individual marginal tax rates.

What does this mean for you?

What this means is that the uncertainties surrounding  SDTs can be and should be managed and addressed right from the beginning at the planning stage so that there are no adverse tax consequences arising at the end.

As with any other trusts, the terms of the trust deed are paramount and, careful consideration should be given in nominating the residual/specified beneficiaries upon the end of the trust, and if an SDT is established under a Will, the terms of the Will should be in line with the terms of the SDT and ultimately your objectives.

How we can help

The Wills, Estate Planning and Structuring team at Moores is one of the largest in Australia with expertise in trusts and taxation. We can provide strategic advice tailored to your specific circumstances and work with you and your advisors through complex structuring, succession planning and tax issues in relation to special disability trusts from planning stage through to administration of same upon vesting.

Contact us

If you have any general queries regarding a Special Disability Trust, please do not hesitate to contact us.

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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to your organisation.

  1. Section 1209M of the Social Security Act (Cth). ↩︎
  2. Section 95AB of the Income Tax Assessment Act 1936 (Cth) (‘ITAA36’). ↩︎
  3. Section 98 of ITAA36. ↩︎
  4. Whitby v Von Luedecke [1906] 1 Ch 783. ↩︎
  5. Re Legh’s Settlement Trusts; Public Trustee v Legh [1938] Ch 39). ↩︎
  6. Pearks v Moseley (1880) 5 App Cas 714. ↩︎
  7. Clay & Ors v James & Ors [2001] WASC 18. ↩︎
  8. Saunders v Vautier [1841] EWHC J82. ↩︎
  9. Section 101A of ITAA36; FCT v Whiting (1943) 68 CLR 199; 7 ATD 179; and Taxation Ruling IT 2622 ↩︎
  10. Section 99A of ITAA36. ↩︎
  11. Sections 97,98 of ITAA36. ↩︎

A binding death benefit nomination (BDBN) is a written instruction given by a member of a superannuation fund, directing the trustee to pay the member’s superannuation benefits to one or more of their ‘dependants’ and/or legal personal representative after their death.

Provided that the BDBN complies with the relevant fund’s requirements and is valid at the time of the member’s death, the trustee must comply with the direction in the nomination and pay the death benefit in accordance with that direction. Each super fund, including self managed super funds (SMSFs) will have their own requirements for making a valid BDBN, but generally, a nomination must:

  • Clearly outline the recipients of the death benefit and the proportion or amount of benefit to be paid to them;
  • Be signed by the member;
  • In many cases, witnessed by two independent witnesses; and
  • Provided to, or accepted by, the trustee of the fund.

Let’s look at why you might choose to have a BDBN and the issues that could arise if you do.

Reasons for completing a BDBN

There are a number of reasons for why you may have, or be advised to have, a BDBN in place. For example:

  • A BDBN puts you in control and provides you with certainty that your superannuation death benefits will be distributed in the way you have outlined in the nomination. It prevents the trustee (who, in the case of externally managed funds, may be one or more individuals representing the trustee who have no connection to you) from exercising discretion over the payment of your benefits, which may otherwise not align with your intentions.

    You may require certainty because:

    • You have a challenge risk to your estate and want to avoid death benefits being paid to your estate to be distributed in accordance with your Will. Note that under current law in Victoria, superannuation is not an asset able to be challenged unless it forms part of your estate, but this is not the case in all Australian jurisdictions;

    • Alternatively, you want to direct your superannuation to your estate because:

      • Your Will includes provisions and structures which are intended to provide your beneficiaries with increased asset protection and permitted tax concessions (eg, testamentary trusts or a superannuation death benefits testamentary trust); or
      • Your priority is to restrict access to capital for certain beneficiaries which would not be possible if they received the benefits outright, even if this may not be the most tax effective way of distributing the death benefits; or
      • You have vulnerable beneficiaries or young children who you wish to benefit on death, and want to avoid such beneficiaries obtaining control of the death benefits via the trustee exercising its discretion to pay death benefits directly to them;

  • A valid BDBN may speed up the death benefit payment process. Where there is no BDBN in place, trustees of superannuation funds will generally need to investigate and gather additional information to enable them to consider and determine the recipient of the benefits. This can result in payments being delayed and held up for months or years after the death of the member; and

  • The circumstances in which a BDBN can be challenged are generally limited to the validity of the document, eg, a challenge based on the decision-making ability of the member to make the BDBN, or the formalities of the document. A valid BDBN cannot be challenged just because an aggrieved or disgruntled beneficiary believes it to be unfair or unreasonable.

Drawbacks of a BDBN

Whilst a BDBN provides you with certainty and allows you to direct how your superannuation entitlements are to be dealt with on death without the trustee involved in the decision, a BDBN can potentially have the following drawbacks:

  • A BDBN should never be completed in isolation to addressing your overall estate planning, and without understanding the tax implications of directing death benefits to a particular person or in a particular manner. For most people, superannuation is likely to be only one part of their assets or structure and a BDBN may be inconsistent with other documents or planning strategies which may be advised by a lawyer;
  • In many circumstances, there is a loss of flexibility as the trustee cannot consider the beneficiaries, circumstances or laws at the time of your death.  As death may be some time after the completion of a BDBN, it is advisable to regularly review your nomination, and, if appropriate, update or renew the nomination, notwithstanding that it would not otherwise expire;
  • The BDBN may expire after a period of time, or upon the occurrence of a specified event, without your knowledge.  It is important to familiarise yourself with the rules of the fund and the occasions where a binding nomination may become ineffective or invalid. For example, the deed for the fund may specify that a BDBN:
    • Lapses after 3 years, even if in the case of SMSFs, BDBNs can be non-lapsing; or
    • Ceases on the occurrence of certain life events such as marriage, separation or divorce, or where the person nominated in the BDBN has predeceased the member;
  • When you commence a pension, you may nominate a reversionary beneficiary to receive the balance of your pension on your death as part of the terms of the pension.  As such, when you die, there may be two documents in place – a reversionary nomination and a BDBN. The governing rules of the fund may specify that for benefits in pension phase, a reversionary nomination takes precedence over a BDBN.  In this case, the BDBN will be ineffective for the benefits subject to the reversionary nomination but may still remain valid for any benefits continued to be held in the accumulation phase. Problems can potentially arise if a deed is silent on which document or nomination prevails.

A discussion on death benefit payment strategy should always be considered as part of an estate plan and never in isolation. Whilst the overwhelming benefit of a BDBN is certainty and control, it is important to regularly review your BDBN to ensure that it aligns with your current wishes and objectives.

How we can help

For advice or guidance regarding Estate Planning and Family Law including BDBN, please do not hesitate to contact us.

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If you have any general queries regarding a BDBN, please do not hesitate to contact us.

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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to your organisation.

Taxation Ruling TR 2013/2 (TR 2013/2) sets out the Commissioner’s interpretation of the law in relation to tax-deductible school building funds. The Australian Taxation Office published an updated ruling in October 2024 to reflect the more holistic approach taken by the Federal Court in the case of The Buddhist Society of Western Australia Inc v Commissioner of Taxation (No 2) [2021] FCA 1363 (the Buddhist Society Case). The updated ruling significantly broadens the categories of organisations that may be eligible for endorsement as school building funds.

Prior to October 2024, TR 2013/2 stated that:

  • a ‘school’ was an organisation that provided regular, ongoing and systematic instruction in a course of non-recreational education; and
  • the following factors ‘indicate’ that an organisation is providing instruction as a school: a set curriculum; suitably qualified persons providing instruction; enrolment of students; some form of assessment and correction; and creation of a recognised qualification or status.

In practice, many institutions providing ‘education’ were unable to satisfy these criteria.1

In the Buddhist Society Case, the Court found that the factors expressed in the original version of TR 2013/2 did not reflect the ordinary meaning of the term ‘school’. In particular, TR 2013/2 inappropriately elevated factors referred to in case law to the level of “prerequisites or inherent requirements” for school building funds. The Court took the view that a more holistic approach was required.

The ATO released a Decision Impact Statement on 18 May 2023 advising that it would review and update 2013/2 to reflect the Buddhist Society Case. The ATO subsequently updated TR 2013/2 on 4 October 2024. The key changes are discussed below.

A broader definition of school

The updated TR 2013/2 now explicitly incorporates the broader judicial definition of a ‘school’ adopted in the Buddhist Society Case, being ‘a place where people, whether young, adolescent or adult, assemble for the purpose of being instructed in some area of knowledge or of activity.2

Importantly:

  • Indicative factors for a school are now explicitly ‘not required’
    While the updated TR 2013/2 still lists factors that ‘can help demonstrate there is a school’, it now explicitly states that these factors ‘are not required’.3 Formal examination or testing, or the granting of formal awards of certificates of completion, is no longer required.
  • A recreational course of instruction can be a school
    The original TR 2013/2 provided that ‘school’ did not include training in a mere hobby or recreational pursuit. The updated TR 2013/2 now states that ‘Schools are not limited to those focused on academic pursuits and includes (but is not limited to) recreational, technical, arts and agricultural schools’.4

A purpose based approach to when a building is ‘used as a school’

The Buddhist Society Case also provided crucial guidance on how to assess whether a building is ‘used as a school’. A building will be ‘used as a school’ where it is used to provide instruction (or its use is incidental to the provision of instruction – such as a kitchen or bathroom facilities) and the extent and character of that use is such that the building can be described as ‘used as a school’.

The original TR 2013/2 stated that for a building to be a school building, its school use must be ‘substantial’. It focused on whether non-school use is of such kind, frequency or relative magnitude as to preclude the conclusion that the building has the character of a school building. The factors considered were primarily quantifiable, including the time, physical area, number of people and degree of modification dedicated to school versus non-school use.

In the Buddhist Society Case, the Court rejected this quantitative approach and found that the proposition that school use must be ‘substantial’ was not explicitly reflected in the case law. Instead, the Court stated that regard must be had to the following factors. These are now explicitly included in the updated TR 2013/2 as factors that must be weighed to determine whether a building has the character of a school building:

  • the overall purpose(s) for which the building has been established and maintained;
  • the importance of each of the activities carried out to that purpose;
  • any connection that the non-school activities may have to the school activities carried out; and
  • the extent to which school and non-school activities contribute to the furtherance of that purpose.

This enables a more holistic assessment to be made about whether a building can be a ‘school building’. Quantifiable factors such as physical area and time may be indicative but are no longer determinative.

Greater access to tax deductibility

The updated TR 2013/2 has replaced the ATO’s restrictive approach to what constitutes a ‘school’ and ‘school use’ with a broader, more flexible approach. This may enable more organisations that provide ‘instruction in an area of knowledge or activity’ to seek tax-deductible gift recipient endorsement for the operation of a school building fund. In particular, organisations that provide less traditional forms of education (for example, that do not include assessment or correction or provide a recognised qualification or status) such as religious instruction (e.g. Sunday schools or Buddhist meditation schools) or recreational instruction (e.g. dance schools, cookery schools, riding schools or woodwork schools) may now be eligible for endorsement. This may unlock funding opportunities and fast track community fundraising initiatives for capital projects.

How can Moores support you?

Our Charity and Not-for-profit team can assist you in understanding the changes to the ATO’s position and assessing your eligibility for endorsement as the operator of a tax-deductible school building fund. We can support you to apply for endorsement and help you understand the rules and requirements for operating a school building fund, enabling the acquisition, construction, or maintenance of school buildings through tax-deductible donations.

Contact us

Please contact us for more detailed and tailored help.

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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisation.

  1. TR 2013/2 superseded Tax Ruling 96/8 and had introduced a number of these indicative factors. Though the previous tax ruing had provided as follows: “The term “school” would usually connote a place where instruction is given by qualified persons in accordance with a set curriculum and there is some form of student assessment and correction.” (paragraph 46). ↩︎
  2. McKerracher J, citing with approval the statement of Barwick CJ in Cromer Golf Club Ltd v Downs (1973) 47 ALJR 219 (The Buddhist Society Case at [94]) ↩︎
  3. TR 2013/2, paragraph 12B ↩︎
  4. ↩︎

Nine years ago, a Victorian court case significantly diminished the rights of injured people to argue that a bad waiver should be struck out. In the Bounce case, the court upheld one of these waivers for the first time.

This historic case has left its mark on the Victorian recreational services landscape. As a result of Rakich v Bounce, consumers can no longer be reasonably confident that they will be recompensed if injured. Schools can no longer adopt the presumption that a broadly worded waiver is unlikely to be valid.

Despite this, we still see documents from camp and excursion providers seek to include unacceptable waivers, often on the basis of “our insurer says we have to include this”.

Needless to say, schools should take pause before bundling waivers into the excursion documentation.

Heading outside the school gates

Snowboarding. Horse-riding. Rock climbing. Hiking.

Immersive experiences such as outdoor, wildlife and adventure excursions, help create rich educational experiences for students and are thought to deepen the benefits of in-class education.1 These activities are often classed as ‘high-risk recreational activities’ and are facilitated by third parties with specialist expertise, equipment and licenses. Arrangements with these providers will often involve a liability waiver, sometimes as a condition of student participation.

Knowing these cannot be signed by the school on behalf of students,2 schools will often pass these on for signature by a parent or carer.

However, while waivers have become a mundane part of the consumer experience, they are not toothless. Additionally, the education context brings further matters to consider – some of them quite complex.

Common ‘red flags’

While, the non-delegable duty of care prevents schools from ‘pointing the finger’ at a third party provider, even if that provider holds the expertise, a school should not be quick to accept a waiver of liability as it can affect the school’s commercial position.

Although a waiver of liability can appear to be a checkbox measure, there are common ‘red flags’ which indicate an inherent conflict with the function of a waiver and a school’s obligations and activities.

For instance, issues arise when a third party waiver:

  • is not with the school (who is the party procuring the services)
  • purports to remove rights from a student
  • asks a parent/carer/guardian to guarantee or agree to something when they won’t be present to supervise
  • seeks to exclude liability for negligence or for failure to exercise due care and skill

or even –

  • has permissible liability exclusions which could result in an injured party pursuing a school for costs, instead of the provider.

This last ‘red flag’ has become more prominent in recent years. Historically, waivers have been difficult to enforce because they are frequently too broad and considered largely unenforceable due to public policy. However, in the November 2016 Bounce decision, the Supreme Court of Victoria reversed the historical position on appeal in favour of the provider, and not the injured person.

Rakich v Bounce

Clinton Sean Rakich3 was an adult who attended Bounce Inc, a trampoline centre, with friends at 9pm on a Thursday night. Part-way through the evening, he joined a game of ‘dodgeball’ on a framework of sixteen trampolines separated by padded steel framing. During this game, Mr Rakich landed awkwardly on a padded beam, resulting in a significant tibial injury to his right leg.

As well as claiming that Bounce had failed in its duty of care to provide adequate warning and safety information, Rakich argued that Bounce wasn’t able to rely on their waiver.

Under the Australian Consumer Law (ACL), providers have to guarantee the use of due care and skill and fitness for a particular purpose. However, recreational service providers can be excluded from these guarantees if their terms meet very specific conditions.

Mr Rakich contended that Bounce could not access the exclusion because the terms did not meet the pre-conditions. Specifically, he argued that:

  • If the exclusions were to be read as one whole, then they were broader than what was allowed and therefore all exclusions of liability had to be struck out.
  • Alternatively, if the exclusions could be read as separate terms, then the specific conditions under the ACL had not been met.

Ultimately, the Court determined in favour of Bounce. It both read down the parts of the waiver that were too extensive to fit within the ACL’s parameters, as well as read the exclusion terms as a whole (recognising the presence of the specific conditions). Mr Rakich’s claim for damages was dismissed.

And whilst the Bounce case does not impact the non-delegable duty of care which schools owe to students, it means that even if a school does everything right by the children in its care, taking all reasonable steps to reduce the risk of reasonably foreseeable harm, it could still be left ‘holding the bag’ for loss and damages in the event of an incident.

For schools which are coordinating excursions involving high-risk activities across classes of diverse ages and abilities, even a brief waiver can now pose a substantial financial risk.

Dissolving the deadlock

We are increasingly seeing contention between third party providers who insist on their standard form waiver as a precondition to engagement, and schools who are unwilling to endorse the documents to parents/guardians.

But whether or not students are able to access enriching activities outside the classroom should not be at the mercy of the waiver.

How we can help

If you have a waiver with red flags on your desktop, the Education Team at Moores has successfully provided schools with pathways for managing the commercial risks and negotiating amendments with third parties. Subscribe to receive updates when we release our Excursion Risks Toolkit, and reach out for support putting proactive resources in place so that your school is on the front foot with a clear position and mechanisms for navigating provider expectations.

Contact us

To mitigate risks to your school whilst preserving and promoting rich educational experiences for students, contact Cecelia Irvine-So for further support and subscribe to receive updates directly in your inbox.

  1. Frontiers | Getting Out of the Classroom and Into Nature: A Systematic Review of Nature-Specific Outdoor Learning on School Children’s Learning and Development ↩︎
  2. Excursions: Liability, waivers and indemnities | VIC.GOV.AU | Policy and Advisory Library ↩︎
  3. Clinton Sean Rakich v Bounce Australia Pty Ltd [2016] VSCA 289 – BarNet Jade ↩︎