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02 Feb 12 CGT trust streaming: specifically entitled and share of net financial benefit - TD 2012/D2

On 1 February 2012, the ATO released for public comment by 2 March 2012 draft Taxation Determination TD 2012/D2.

The draft, which deals with one aspect of the new trust streaming provisions, is entitled "Income tax: capital gains: for the purposes of s 115-228(1)(a) of ITAA 1997 can a beneficiary of a trust estate be reasonably expected to receive a share of the net financial benefit referable to a capital gain made by the trust estate in an income year if the fact that the capital gain was made is not established until after the end of the income year?"

The answer given to the question posed is:

"Yes, it is possible (depending on the circumstances) for a beneficiary of a trust estate to be reasonably expected to receive a share of the net financial benefit referable to such a gain...despite the making of the capital gain not being established until after the end of the income year. The reasonable expectation requirement is directed to the future receipt of an amount referable to the gain should it arise, not to the likelihood of the gain itself occurring."

 


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