trusts

Concession for testamentary trusts to be wound back

In the Federal Budget last April, the Government announced it would make changes to the tax treatment of testamentary trusts, and an exposure draft of amendments was released by Treasury at the start of the current quarter. The assessable income of a minor from a distribution from a testamentary trust is taxed at ordinary rates,

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Deceased estates: Guidance to tying up those loose ends

To make it easier to finalise deceased estates, there have been some improvements in the ATO’s guidance for managing the tax affairs of deceased estates. First of all, there is now a telephone option to notify the ATO that a taxpayer has passed away. You can phone 13 28 61 to give the ATO an “unofficial” notification

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Could trust splitting soon result in increased tax obligations?

  A draft taxation determination released in July has triggered some alarm among practitioners that certain previously benign trust re-arrangements may soon lead to new tax obligations being attached. TD 2018/D3 posits that certain trust split arrangements should be viewed as the creation of a new trust over some, but not all, of the assets

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The special place for family trusts

  Trusts can be a very handy tool for managing one’s financial affairs, as well as estate planning. A trust is established whenever there is a separation of the legal ownership (for example, the name appearing on a business register or land title) from the beneficial owner of an asset (in other words, the person

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Trust streaming of capital gains and franked dividends

The ATO has stated that a trust’s capital gains and franked dividends can, if not prevented by the trust deed, be streamed to beneficiaries for tax purposes by making these beneficiaries “specifically entitled” (more below) to the amounts. Streaming trust capital gains and franked distributions This allows beneficiaries to offset capital gains with their capital

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Overview of estate planning and testamentary trusts

Estate planning involves developing a strategy to deal with assets after a person dies – with the legal instruments and structures, such as a will, put in place to transfer the ownership of these assets in the event of death. Estate planning and testamentary trusts Tax is a major consideration in estate planning, and strong

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The process (and pros and cons) of ‘electing’ to be a family trust

Trusts are an important and very useful concept for managing one’s financial affairs, as well as estate planning. The pros and cons of ‘electing’ to be a family trust A trust is established whenever there is a separation of the legal ownership (for example, the name appearing on a land title) from the beneficial (equitable)

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Contrived trust income arrangements “not on”, says ATO

The ATO’s “trusts taskforce” has uncovered a class of arrangements that it says appears to be designed to “exploit the proportionate approach to trust taxation”. Therefore a taxpayer alert has been issued by the ATO that warns closely held trust trustees against engineering a reduction in trust income to improperly gain access to favourable tax

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