Working out the amount of attributable income to include in your assessable income
Warning:
This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.
End of attentionIf you are an attributable taxpayer in relation to a non-resident trust estate, all the attributable income of the non-resident trust estate for an income year coinciding with your income year is included in your assessable income.
If there is more than one attributable taxpayer, the Tax Office may allow a reduction of the amount of attributable income to be included in the assessable income of each attributable taxpayer. To obtain the reduction, the taxpayer must apply to the Tax Office - refer to subsection 3 for more information.
Resident for part of a year
If you are a resident for only part of the income year, the attributable income included in your assessable income is reduced. The amount included is worked out as follows:
Notional attributable income
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the number of days during the period that you were a resident ÷ total number of days in the period
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Example 3: Part-year residency
George is a resident of Australia for 200 days out of the 365 days in the income year 1 July 2003 to 30 June 2004. He is an attributable taxpayer in relation to YZ trust that was a non-resident trust with the same income year. The attributable income of the trust estate was $40,000.
The amount George is required to include in assessable income for 2003-04 is:
$40,000 × (200 ÷ 365) = $21,917
End of exampleOverlapping years of income
If you are an attributable taxpayer and your income year is different from that of a non-resident trust estate, the trust estate's attributable income for the two income years which overlap your income year is apportioned using the number of days that fall within your current income year.
Example 4: Overlapping years of residency
Helen's current income year is 1 July 2003 to 30 June 2004. She is an attributable taxpayer in relation to XY trust estate. The trust estate's income years are 1 January 2003 to 31 December 2003 and 1 January 2004 to 31 December 2004. The attributable income of the trust estate is $30,000 for the 2003 income year and $40,000 for the 2004 income year.
The amount worked out for the trust estate's 2003 income year is:
$30,000 × (184 ÷ 365) = $15,123
For the trust estate's 2004 income year, the amount is:
$40,000 × (181 ÷ 365) = $19,835
Helen adds the amounts to give a total attributable income of $34,958 for her 2003-04 income year.
End of examplePartnerships and trusts
The attributable income from a trust estate is included in working out the net income of a partnership or a trust estate and is treated as having a foreign source.
Where a partner of a partnership or a beneficiary of a trust estate is an Australian resident for the whole income year, they are to include in their assessable income their share of the net income - including attributable income - of the partnership or trust estate.
Where a partner or beneficiary is a non-resident of Australia at all times during an income year, they would not include any attributable income of the partnership or trust estate in their assessable income.
Last modified: 05 Dec 2006QC 17522