The use of a rarely used “anti-avoidance” provision, which triggers landholder duty when there is a change of control of the trustee of a unit trust, has been upheld by VCAT.

A VCAT decision has upheld the use by the Victorian State Revenue Office (VSRO) of a rarely used landholder duty provision (originally introduced as an “anti-avoidance” measure), despite the taxpayer not acquiring any further units in a Victorian landholding unit trust. This decision confirms the breadth of the landholder duty provisions that can capture taxpayers that obtain the capacity to make financial decisions over landholding companies or trusts.

The use of this provision could have wide-ranging implications for changes to directorships of landholding unit trusts and companies (at least in Victoria).

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