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Trust splitting - some clarity at last

Publication date: 12 Feb 16 | Source: WEEKLY TAX BULLETIN

Issue: Issue 6, 12 Feb 2016


The recent Tax Office Private Binding Ruling 102921290075 considers a number of key issues relating to the concept of trust splitting.

While trust cloning is generally seen as preferable to trust splitting, there are a range of reasons cloning may be commercially inappropriate including:

  • an inability to access any of the small business CGT rollovers;
  • assets that do not lend themselves to complete separation;
  • no stamp duty relief (which is the case in most Australian states).

The Ruling is a timely reminder of the need to ensure care is taken with any intended rearrangement of an existing trust.

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Matthew Burgess CTA
Photo of author, Matthew BURGESS Matthew co-founded specialist firm View Legal in 2014, having been a lawyer and partner of one of Australia’s leading independent law firms for over 17 years. Matthew’s passion is helping clients successfully achieve their goals. Matthew specialises in tax, and estate and succession planning, providing strategic advice to business owners and high net worth individuals. He has been recognised in the Best Lawyers list since 2014 in relation to trusts and estates and either personally or as part of View Legal in Doyles since 2015 in relation to taxation, and since 2017 in relation to wills, estates and succession planning. In part leveraging off the skills he has developed working in the SME market space, Matthew has been the catalyst for a number of innovative legal solutions for advisers and their clients, including establishing Australia’s first virtual law firm. - Current at 13 August 2018
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