Bankruptcy and superannuation

Clawing back pre-bankruptcy superannuation contributions.

Bankruptcy trustees investigate pre-bankruptcy transfers or transactions when they believe the transaction improperly dissipated or removed assets that would otherwise be available to creditors. The Bankruptcy Act 1966 can permit voiding of these transactions and require the other party to return an asset, or make a payment, to the bankruptcy trustee.

Under section 128B a debtor's transfers are void if made after 28 July 2006, and:

• They are made to eligible superannuation plans of the bankrupt.
• The property would have formed part of the bankrupt estate if the transfer had not been made.
• The main purpose of the transaction was to keep an asset from falling into the bankruptcy trustee's hands and being available to creditors.