23 Jan 1313 How to complete labels 64A and 65W of the trust tax return
The ATO has published a factsheet with instructions on how to complete new labels 64A and 65W of the trust tax return.
The amount to include at label 64A is the total income of the trust that is legally available for distribution to trust beneficiaries for the income year (distributable income). In determining that amount, taxpayers need to consider the trust deed, the trust accounts, and relevant resolutions and determinations.
Label 65W records the amount of the trust's distributable income that each beneficiary was presently entitled to by the end of the income year.
In relation to the question whether the distributable income shown at label 64A should be based on the views in TR 2012/D1, the factsheet states as follows:
"Draft Taxation Ruling TR 2012/D1 gives guidance on the meaning of distributable income. Under self-assessment, you can follow the meaning as set out in the ruling or, if you disagree with aspects of that ruling, you can apply what you understand the term to mean for the purpose of present entitlement and completing labels 64A and 65W.
At labels 64A you must show the trustee's honest determination of the trust's distributable income. The trustee may think that its distributable income is calculated based on one of the alternative views in TR 2012/D1, for example, according to a so-called 'income equalisation clause'. If so, you can include this amount at Label 64A.
Even if we later consider the trust's distributable income is a different amount, the trustee won't have made an error in completing Label 64A."