Update 13th September 2024: Our systems are now restored following recent technical disruption, and we’re working hard to catch up on publishing. We apologise for the inconvenience caused. Find out more
Trusts are a popular form of business and investment vehicle in Australia and are also established for a variety of other reasons (eg charitable purposes). This chapter examines the nature of a trust and discusses how trust estates are taxed. The general rules relating to the taxation of trust estates are contained in div 6 of pt III ITAA36 (ss 95AAA to 102). Division 6 calculates the ‘net income’ of a trust estate and assesses the net income in the hands of either the beneficiaries or the trustees of the estate. The operation of the assessment rules depends on whether a beneficiary is ‘presently entitled’ to a ‘share’ of the ‘income’ of the trust estate and whether the beneficiary is under a ‘legal disability’. The rules also operate subject to jurisdictional rules that take into account the concepts of residence and source. Trusts differ fundamentally from companies in that they are not treated as separate taxpayers. Although s 960-100(1) ITAA97 refers to a trust as an ‘entity’, no tax is payable by a trust.
Review the options below to login to check your access.
Log in with your Cambridge Higher Education account to check access.
If you believe you should have access to this content, please contact your institutional librarian or consult our FAQ page for further information about accessing our content.