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2 Jun 2018

Avoid extra tax

Do you have a Discretionary Trust (also known as a Family Trust)?

If yes, you MUST keep reading!

In the lead-up to 30 June 2018, we want you to be aware that you need to complete your trust distribution resolutions before 30 June. Why? To avoid paying extra tax of up to 47% of Trust profits.

How can this happen?

If a Trustee of a Trust fails to make a resolution to distribute the income of the Trust before the end of the financial year, the Trustee may be assessed by the Australian Taxation Office (ATO) on the Trust income at the highest marginal tax rate of 47%, rather than the intended beneficiary(s) being taxed.

What we are doing to help you…
Even though preparing a trust distribution resolution before the end of the financial year can be quite complex, we need to comply with the recent changes to trust taxation laws.

The steps we need to undertake on your behalf include:

  • Review of your prior year Trust Distribution Resolution
  • Confirmation with you of the estimated Trust income of your Trust for the year ended 30 June 2018
  • Review of your Trust Deed to ensure that the income definition and distribution clauses in your Trust Deed allow the proposed Trust Distribution Resolution for 30 June 2018
  • Advise on the most tax effective distribution of this estimated Trust income
  • Preparation of Trust Distribution Resolution and ensuring it is signed by the Trustees PRIOR to 30 June 2018.

Contact us to get started!

 

This article is provided as general information only and does not consider your specific situation, objectives or needs. It does not represent accounting advice upon which any person may act. Implementation and suitability requires a detailed analysis of your specific circumstances.