Can the trustees make income and capital payments to the principal beneficiary?
There are two express restrictions as to how the trustees can apply the income and capital of the Special Disability Trust. The first relates to services or property provided by immediate family members or the children of the principal beneficiary. Essentially, no payments from the trust can be made to an immediate family member (or the child of the principal beneficiary) to provide care services or repair or maintenance services of the beneficiary’s accommodation. The second is that the trust fund cannot be used to purchase or lease property from an immediate family member (or child of the principal beneficiary). This restriction applies even if the property is to provide accommodation for the beneficiary. In the case of both restrictions, it is irrelevant whether the services, the purchase or lease is on arms length terms. Additionally, the legislation permits Centrelink to issue guidelines on what constitutes ‘reasonable care and accommodation needs’. Guidelines have now been issued
