Commissioner unsuccessful in the Bendel Division 7A appeal

Implications from this case could potentially be broader than just 109D(3), with the decision leaving open the application of other provisions which deal with payments, loans and debt forgiveness made by trustees to a shareholder or an associate, as discussed by Brent Murphy, Kristie Schubert, Scott Farrell and Josh Cardwell.

The Full Federal Court (FFC) constituted by Logan J, Hespe J and Neskovcin J yesterday handed down their unanimous decision, in Commissioner of Taxation v Bendel [2025] FCAFC 15, on one of the most highly anticipated tax decisions over the last few years. The critical question for determination by the FFC was whether an unpaid present entitlement (UPE) to income (or capital) of a trust estate is a 'loan' for the purpose of s 109D(3) of the Income Tax Assessment Act 1936 (ITAA 1936). Key poi...

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Authors: Brent Murphy, Kristie Schubert,

Published Date: 21 February 2025