Trusts 2018

TD 2018/D3: ATO swings for trust splitting; hits much further

Source: Taxation In Australia Journal Article

Published Date: 1 Sep 2018


The arrival of TD 2018/D3 on trust splitting disrupts the pleasant calm around trust variations since TD 2012/21, when the ATO seemed to throw its hands in the air post-Clark and say that almost anything done in accordance with powers under a trust deed is not a resettlement. The draft ruling introduces a different approach to trusts, the new trust view, which has historically been a minority view supported by such thinkers as Dr Campbell Rankine and Mark Robertson, QC.

By adopting the new trust view in regard to trust splitting, the ATO will (correctly) put CGT event E1 as a live issue on each change in trustee of a trust. What constitutes a resettlement will need to fi nally move away from the substratum of the trust tests in line with more recent authority.

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Trusts 2018

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