You may be aware that the Australian Taxation Office recently challenged the validity of trustees using streaming clauses within discretionary trust Deeds to enable different classes of income to be distributed to different beneficiaries (e.g Franked income, capital gains, interest income etc). Following the 2010 High Court decision in Bamford v F C of T,
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Further to Client Alert No 2, the Australian Taxation Office (ATO) has finalised Draft Taxation Ruling TR 2009/D8 and released it in final form as Taxation Ruling TR 2010/3. In addition, the ATO has released Practice Statement PS LA 2010/4 which gives ATO employees guidance as to how TR 2010/3 should be interpreted (but also
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In the 2009 Federal Budget, it was announced that the maximum concessional contribution able to be made to a complying superannuation fund for the 2009/10 financial year would be halved to $25,000 (and a transitional amount of $50,000 for those taxpayers over the age of 50). This has focused attention on contributions which may inadvertently
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On 16 December 2009, the Australian Taxation Office (ATO) released Draft Taxation Ruling TR 2009/D8 (now TR 2010/3). The draft ruling outlines the ATO’s position where a private company with a present entitlement to an amount from a trust may be taken to have made a loan to the trust under Division 7A of the
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Distributing income from trusts to companies has been a longstanding practice by taxpayers and practitioners to limit the tax on earnings initially to the corporate rate of 30%. Any “top up” tax is usually paid by the shareholder when the company declares dividends as a result of their marginal rate often being higher than the
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