Pre-CGT status – can it be retained when shares are held through a discretionary trust?

The Administrative Review Tribunal held that changes in the trust distribution patterns did not trigger the operation of Division 149 in XLZH v Commissioner of Taxation [2025] and taxpayers holding pre-CGT assets should seek advice as to review the way their pre-CGT assets are held.

This is the question considered in the recent case of XLZH v Commissioner of Taxation [2025] ARTA 2154, where the Administrative Review Tribunal (ART) examined whether pre-capital gains tax (CGT) status can be retained when shares are held through a discretionary trust. The ART found the answer to this question was 'yes' and held that changes in the trust distribution patterns did not trigger the operation of Division 149 of the ITAA 1997 to convert pre-CGT assets to post-CGT assets. While ...

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Authors: Samuel Sloane, Craig Jackson,

Published Date: 08 December 2025