Special Disability Trusts were introduced by the Commonwealth Government in 2006 to allow private financial provision for the current or future accommodation and care of a family member with a severe disability, without being affected by social security rules on means testing or gifting. To encourage greater take up, from 1 July 2009 the Government will extend the capital gains tax main residence exemption to include a residence that is owned by a Special Disability Trust and used by the relevant beneficiary as their main residence. In addition any unexpended income of a Special Disability Trust will now be taxed at the beneficiary’s personal income tax rates, rather than the highest marginal tax rate, starting from the 2008-09 financial year. The Australian Government is reviewing all recommendations from the Senate Committee, including broadening eligibility to make it easier for people to establish Special Disability Trusts.

More information on these measures is contained in the Fact Sheets available online at: www.fahcsia.gov.au.