The ATO has commenced issuing notices for its compliance program focusing on the “Next 5000” private groups in Australia. This article provides our top tips for preparing for an audit and how we can assist you in doing this.

Legislation passed on 17 June 2020 has amended the ITAA36 to change the taxation treatment of distributions of income from testamentary trusts to minors.

When varying a trust deed is vital to ensure that the variation is in accordance with the variation power and, critically, whether the particular variation can be made at all.

This article discusses the challenges of rectifying mistakes in trust deeds by way of a deed of rectification, particularly in the context of tax disputes involving revenue authorities.

We have previously written about carefully reading the clauses of a trust deed when seeking to make variations. The recent Federal Court decision of Advanced Holdings once again exemplifies the adverse outcomes that can arise when protocols prescribed in a trust deed are not followed.

The trustee of a discretionary trust may benefit those who fall under the definition of “beneficiaries” in the trust’s deed. Sometimes, the scope of that definition is unclear.

This article looks at the scope of the definition of the term “beneficiary” in a discretionary trust deed, and, in particular, examines the ambiguities that sometimes arise in relation to the terms “spouse” and “child” within that definition

As we discussed in Coelho v FCT [2020] AATA 2474, different tax rates apply to residents and non-residents. Further, under Pt III of Sch 7 to the Income Tax Rates Act 1986, a working holiday maker pays tax at 15% on the first $37,000 of income in Australia. Commonly referred to as the ‘backpacker tax’.

We wrote here on the decision of Thawley J of the Federal Court in Peter Greensill Family Co Pty Ltd (trustee) v FCT (Greensill) where the Commissioner of Taxation was successful in arguing that section 855-10 of the Income Tax Assessment Act 1997 (ITAA 1997) does not disregard a capital gain distributed to a foreign resident beneficiary of an Australian discretionary trust. The taxpayer has appealed that decision to the Full Federal Court.

This article looks at what determines the tax residence of a trust and what the consequences can be from a change of tax residence.

Life interest trusts are a popular strategy for blended families in estate planning, but it is important to remember that there’s no one-size-fits-all.

The Australian Taxation Office (ATO) has released a welcome draft legislative instrument, Self Managed Superannuation Funds (COVID-19 Rental income deferrals - In-house Asset Exclusion) Determination 2020 (SPR 2020/D2), that will exclude COVID-19 related rental deferrals from being ‘loans’ under the in-house asset rules.

As the economic effects of COVID-19 continue to be felt across the country, the regulatory landscape for SMSFs has also changed.

In the recent decision of R -v- T [2020] WASCA 109, the Western Australia (WA) Court of Appeal has upheld interim property orders of the WA Family Court to set aside contributions made by a de facto husband to an SMSF.

As referred to in our previous articles, the State Revenue Legislation Further Amendment Bill 2020 (NSW) has now received royal assent on 24 June 2020.

The Victorian Court of Appeal’s decision in MD Commercial Pty Ltd v Commissioner of State Revenue [2019] VSCA 295 was a culmination of the battle between the Victorian Commissioner of State Revenue and the taxpayers’ statutory interpretation of a duty exemption contained in s 35 of the Duties Act 2000 (Vic) (Act) and whether the trustee had to be in a “bare trustee” relationship with no active powers being held by the trustee.

On 26 June 2020, the Australian Taxation Office (ATO) announced a streamlined process for COVID-19 affected borrowers to make applications under section 109RD to extend the time to make minimum yearly repayments (normally required to be made by 30 June 2020) under Division 7A.

When varying a trust deed, careful regard must be directed to the provisions of the deed as a whole, and the potential tax issues which can arise.

Beneficiaries of a unit trust may only claim franking credits if they are a “qualified person” in relation to the franked dividend. In order to be a qualified person the taxpayer must satisfy both the related payments rule and the holding period rule.

As part of its response to COVID-19, on 13 May 2020 the Australian Taxation Office announced that it has extended the time for lodgment of 2019 tax returns for certain companies and trusts and made changes to its administration of Division 7A of the Income Tax Assessment Act 1936.