Tracing of testamentary trust distributions proposed

Income distributions to minors may need to be derived from deceased estate property before qualifying for concessional tax treatment.

The Federal Government has released an exposure draft, and associated explanatory materials, clarifying proposed changes to the taxation of testamentary trust income that is distributed to minors. If implemented, then from 1 July 2019, only the income derived from deceased estate property would qualify for normal individual tax rates, where distributed to minors. Other income distributed to minors from the testamentary trust would broadly be subject to the highest marginal tax rate as set out...

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Authors: Blake Indian, Richard Wilkins

Published Date: 15 October 2019