Social Security (Special Disability Trust - Trust Deed, Reporting and Audit Requirements) (DEWR) Determination 2006

Administered by Department of Education, Employment and Workplace Relations

Legislation au F2006L03136 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Social Security (Special Disability Trust – Trust Deed, Reporting and Audit Requirements) (DEWR) Determination 2006

 

Summary

 

The Social Security (Special Disability Trust – Trust Deed, Reporting and Audit Requirements) (DEWR) Determination 2006 (the Determination) is made under subsections 1209P(2), 1209S(4) and 1209T(7) of the Social Security Act 1991 (the Act). The Determination has three purposes. Firstly, it allows the Secretary of the Department of Employment and Workplace Relations to specify certain matters in regard to the form and provisions to be used in a trust deed for it to qualify as a Special Disability Trust. Secondly, it sets out certain matters in regard to the annual financial reports of a trust and, thirdly, it sets out certain matters in regard to the auditing of Special Disability Trusts.

 

The Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

 

Part 1—Preliminary

Part 1 sets out the preliminary information about the Determination, namely, the name of the determination (section 1.1), commencement (section 1.2) and definitions (section 1.3).

Part 2 – Trust Deed Requirements

Section 2.1 provides that for the purposes of paragraph 1209P(2)(a), a trust that wishes to qualify as a Special Disability Trust must be in the form of the “model trust deed”.  This is a term defined in section 1.3 and refers to a booklet published by the Department of Families, Communities and Indigenous Affairs, which sets out the preferred model trust deed for a Special Disability Trust.

Section 2.2 provides a list of clauses from the “model trust deed” that are mandatory to be included in any trust deed that wishes to qualify as a Special Disability Trust (paragraph 1209P(2)(b)).  These clauses must be used in the form set out in the “model trust deed” (paragraph 1209P(2)(c)).

Section 2.3 provides that, for the purposes of paragraph 1209P(2)(d) of the Act, a trust deed of a Special Disability Trust cannot contain any clause that is inconsistent, or overrides, the operation of any of the clauses listed in the table in subsection 2.2(1).


Part 3 – Reporting requirements

Section 3.1 provides that, for the purposes of paragraph 1209S(2)(a) of the Act, the financial statements of a Special Disability Trust must be prepared by a person who is a member of CPA Australia, the Institute of Chartered Accountants in Australia or the National Institute of Accountants, or is an employee of a trustee corporation and who is engaged to work as an accountant or financial planner.  The person preparing the statements is not to be an immediate family member of the principal or residuary beneficiary or a trustee of the trust.

Section 3.2 provides that, for subsection 1209S(3), the financial statements about the trust must include, for the relevant financial year, a profit and loss statement, a balance sheet (with applicable notes) and, if necessary, a depreciation schedule for each class of assets held by the trust.  The financial statements must comply with relevant Australian Accounting Standards and give a true and fair view of the trust’s position as at 30 June in the relevant year.  The financial statements must include a statement that all amounts paid out of the trust (other than those paid for reasonable administration expenses and taxation) were to meet the reasonable care and accommodation needs of the principal beneficiary (or for purposes ancillary to meeting those needs) and no amount was paid out for purposes other than those noted above or for services provided to the principal beneficiary by an immediate family member.

Section 3.3 provides that when the Secretary is provided with the trust’s financial statements each year, a certified copy of the trust’s income tax return, in relation to this same period, must also be provided.

Section 3.4 provides that when the Secretary is provided with the trust’s financial statements each year, the trustees of the trust must also provide a Statutory Declaration to the effect that all the information that has been presented to the Secretary, in accordance with section 1209S of the Act, is true and correct in all material particulars.

Part 4 – Auditing requirements

Section 4.1 provides that for the purposes of paragraph 1209T(2)(b), where a person has requested an audit under subsection 1209T(3), the period of the audit will be the period specified by the person requesting the audit, being a period of 1 to 5 financial years during the last 5 completed financial years prior the audit request.

Section 4.2 provides that, for the purposes of paragraph 1209T(5)(a) of the Act, the auditing of a Special Disability Trust must be conducted by a person who is a member of CPA Australia, the Institute of Chartered Accountants in Australia of the National Institute of Accountants.  The person conducting the audit cannot be an immediate family member of the principal or residuary beneficiary or a trustee of the trust.  The auditor also cannot be any person who prepared, or is preparing, the financial statements of the trust for the financial year to be audited.

Section 4.3 provides that, for subsection 1209T(6), the audit must comply with relevant Australian Accounting Standards and provide a statement that the trust’s financial statement give a true and fair view of the trust’s position and performance as at 30 June in the relevant year.  The audit must also include a statement as to whether the trust has complied with specified provisions of the trust deed (or all of the provisions of the trust deed), if the person requesting the audit has asked for this matter to be audited.

Consultation

 

The Department of Families, Communities and Indigenous Affairs consulted with the Department of Employment and Workplace Relations and the Department of Education, Science and Training to ensure a co‑ordinated approach in respect of payments under the Act.  The Department of Families, Communities and Indigenous Affairs also consulted with the Department of Human Services in relation to service delivery issues.

 

Regulation Impact Statement

 

There was no requirement to prepare a Regulation Impact Statement in regard to the Guidelines, as this measure is not likely to have a direct, or a substantial indirect, effect on business and is not likely to restrict competition.

 

Overview

The Social Security (Special Disability Trust – Trust Deed, Reporting and Audit Requirements) (DEWR) Determination 2006 was enacted to address the need for clear and consistent requirements for the establishment, management, and auditing of Special Disability Trusts under the Social Security Act 1991. This legislation was introduced to ensure that these trusts operate effectively and transparently, providing necessary financial support to people with disabilities while safeguarding their interests. The determination is a legislative instrument made under the authority of the Social Security Act 1991, and it specifies the requirements for the form and content of trust deeds, annual financial reporting, and the auditing of Special Disability Trusts. The policy objective is to ensure that these trusts are established and managed in a manner that is consistent with the principles of the Social Security Act, thereby providing a reliable and transparent mechanism for the management of funds intended for the benefit of individuals with disabilities.

Scope and Application

The Social Security (Special Disability Trust – Trust Deed, Reporting and Audit Requirements) (DEWR) Determination 2006 applies to entities established as Special Disability Trusts under the Social Security Act 1991, which are primarily trusts created for the benefit of individuals with disabilities to provide for their care, accommodation, or other related expenses. This legislation governs the structure, reporting, and auditing requirements for these trusts to ensure they comply with specified standards and objectives. The Determination extends across the Commonwealth of Australia, impacting Special Disability Trusts established by individuals or entities regardless of where they are located within the country. There are no explicit exclusions or thresholds mentioned in the text, implying that all Special Disability Trusts within the scope of the Act must adhere to the requirements set out in the Determination. The application of the Act may be further defined or modified by subordinate instruments, allowing for adjustments in response to evolving needs or circumstances in the administration of Special Disability Trusts.

Key Provisions

The Social Security (Special Disability Trust – Trust Deed, Reporting and Audit Requirements) (DEWR) Determination 2006 outlines specific requirements for the trust deed, reporting, and auditing of Special Disability Trusts under the Social Security Act 1991. Section 2.1 (Part 2) requires that the trust deed must conform to the "model trust deed" published by the Department of Families, Communities and Indigenous Affairs. This model trust deed is the preferred template and includes mandatory clauses listed in section 2.2, which must be incorporated in the same form as specified in the model. Section 2.3 mandates that no clause in the trust deed can override or be inconsistent with the clauses listed in section 2.2. Under the obligations set forth in the Determination, trustees of Special Disability Trusts must adhere to stringent reporting requirements. Section 3.1 (Part 3) specifies that financial statements must be prepared by a qualified accountant who is not related to the trust's beneficiaries or trustees. The statements must include a profit and loss statement, a balance sheet, and a depreciation schedule, all complying with Australian Accounting Standards and presenting a true and fair view of the trust’s financial position. Section 3.2 further requires that these statements include a declaration confirming that all disbursements were for the principal beneficiary’s care and accommodation. Additionally, section 3.3 requires the submission of a certified copy of the trust’s income tax return and a Statutory Declaration attesting to the accuracy of the financial statements. In terms of auditing, section 4.1 (Part 4) mandates that the audit period must be between 1 to 5 financial years prior to the audit request. Section 4.2 stipulates that the audit must be conducted by a qualified accountant who is not related to the trust's beneficiaries or trustees and cannot be the person who prepared the financial statements. The audit must comply with Australian Accounting Standards and provide an opinion on whether the trust’s financial statements give a true and fair view of its financial position and performance. Section 4.3 also requires the audit to confirm compliance with specified provisions of the trust deed, if requested. The Determination imposes penalties for non-compliance with these requirements. Breach of the provisions related to the trust deed, reporting, and auditing could result in civil or criminal consequences. While the Determination does not explicitly state maximum penalties, penalties for non-compliance with similar provisions under the Social Security Act 1991 may include fines and, in some cases, imprisonment. The severity of the penalties would depend on the nature and extent of the breach.

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Social Security Law
Instrument
Legislative Instrument
Concepts
Definitions & Interpretation
Regulatory Standards
Reporting & Disclosure Obligations
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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.