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  • Completing the tax return – Page 1 Trust tax return

    Attachments to the tax return

    If these instructions ask you to provide additional information, attach the additional information to the tax return and print X in the Yes box at Have you attached any ‘other attachments’? at the top of page 1 of the tax return.

    If, when you have finished completing this return, you have not attached any documents to it, print X in the No box.

    Tax file number (TFN)

    Print the TFN of the trust in the boxes provided.

    Name of trust

    The trust name should be consistent from year to year, except in the year of a name change.

    If the trust name is legally changed, advise us in writing at the time the change is made.

    Australian business number (ABN)

    The ABN is a unique business identifier used in dealings with the Australian Government. It is also available to state, territory and local government regulatory bodies. Identification for tax law purposes is only one of the uses of the ABN.

    Print the ABN of the trust in the boxes provided if the trust is registered in the Australian Business Register.

    Follow the instructions on the trust tax return for the following items:

    • Previous name of trust
    • Current postal address
    • Postal address on previous tax return.

    C/– is the preferred format for ‘care of’.

    Full name of the trustee to whom notices should be sent

    Show the surname or family name and given names of the trustee to whom notices should be sent. If the trustee is a company, show the name and ABN of the company.

    If the trust comprises the property of a bankrupt and the estate is being administered by the Official Receiver, print OFFICIAL TRUSTEE IN BANKRUPTCY in the box provided for the company name. Leave the individual name box blank.

    Daytime contact phone number

    Print a phone number that the trustee can be contacted during business hours.

    Family trust election status and interposed entity election status

    This item must be completed if any of the following apply.

    Family trust elections

    The trustee of the trust:

    • is making a family trust election specifying the 2004–05 or later income year in accordance with section 272-80 of Schedule 2F to the ITAA 1936
    • has previously made a family trust election specifying an income year from 1994–95 to 2016–17 in accordance with section 272-80 of Schedule 2F ITAA 1936 and, if applicable, items 22 or 22A of Schedule 1 to the Taxation Laws Amendment (Trust Loss and Other Deductions) Act 1998 (Trust Loss Act), and that election has not been revoked in accordance with subsections 272-80(6) to (8) of Schedule 2F to the ITAA 1936 in an income year before the 2017–18 income year
    • is revoking a previously made family trust election in accordance with section 272-80 of Schedule 2F to the ITAA 1936
    • is varying the specified individual of a previously made family trust election in accordance with section 272-80 of Schedule 2F to the ITAA 1936.

    Interposed entity elections

    The trustee of the trust:

    • is making one or more interposed entity elections specifying a day in the 2004–05 or later income year in accordance with section 272-85 of Schedule 2F to the ITAA 1936
    • has previously made one or more interposed entity elections specifying a day in any income year from 1994–95 to 2016–17 in accordance with section 272-85 of Schedule 2F to the ITAA 1936 and, if applicable, items 23 or 23A of Schedule 1 to the Trust Loss Act, and at least one interposed entity election has not been revoked in an income year before 2017–18 in accordance with subsections 272-85(5) and (6) of Schedule 2F to the ITAA 1936
    • is revoking from 2017–18 one or more previously made interposed entity elections in accordance with section 272-85 of Schedule 2F to the ITAA 1936.

    A trustee cannot make a family trust election or interposed entity election specifying a year earlier than 2004–05 in the Trust tax return 2018 (sections 272-80 and 272-85 of Schedule 2F to the ITAA 1936).

    Family trust elections

    Section 272-80 of Schedule 2F to the ITAA 1936 allows a trustee to revoke a family trust election and vary the specified individual in a family trust election in certain limited circumstances.

    A trustee cannot vary the specified individual or revoke a family trust election unless the variation or revocation satisfies certain conditions and is in respect of an income year that occurs during the period:

    • starting at the beginning of the income year specified in the election and finishing at the end of the fourth income year after the income year specified in the election, or
    • starting on 1 July 2007 and finishing on 30 June 2009.

    The variation or revocation must be made with the entity’s return of income for the income year from which the variation or revocation is to be effective.

    Interposed entity elections

    Section 272-85 of Schedule 2F to the ITAA 1936 allows an interposed entity election to be revoked in certain limited circumstances.

    A trustee cannot revoke an interposed entity election unless the revocation is in respect of an income year that occurs during the period:

    • starting on 1 July 2007 and finishing on 30 June 2009, or
    • starting at the later of    
      • the beginning of the income year specified in the election, or
      • the beginning of the income year in which the entity became a member of the family group, and
      • finishing at the end of the fourth income year after the income year referred to in the above two dot points.
       

    The revocation must be made with the entity’s tax return for the income year from which the revocation is to be effective.

    For more details, see Trust loss provisions to increase flexibility for family trusts.

    Instructions on how to complete the Family trust election, revocation or variation 2018 and Interposed entity election or revocation 2018 are on the forms themselves.

    If you do not lodge the trust tax return electronically using ELS, then send the tax return with any Family trust election, revocation or variation 2018 and Interposed entity election or revocation 2018 to:

    Australian Taxation Office
    GPO Box 9845
    [insert the name and postcode of your capital city]

    For example;

    Australian Taxation Office
    GPO Box 9845
    SYDNEY NSW 2001

    Family trust election status

    If the trustee of the trust has not made or is not making a family trust election, do not complete this item.

    If the trustee has previously made a family trust election specifying an income year before 2017–18, write the appropriate income year in the four-digit box at this item.

    If the trustee has previously made a family trust election specifying an income year before 2004–05 and took advantage of the one-off opportunity in PS LA 2004/1 (GA) Lodgment opportunity for family trust and interposed entity elections to specify an earlier year, write the earlier income year specified.

    If the trustee is making a family trust election specifying the 2004–05 or later income year, write the appropriate income year in the four-digit box at this item and complete a Family trust election, revocation or variation 2018 specifying the 2004–05 or later income year.

    Revoking a family trust election

    A family trust election can only be revoked by a trust that satisfies the relevant conditions in section 272-80 of Schedule 2F to the ITAA 1936.

    Print R in the single box at this item if the family trust election made by the trust is being revoked in 2017–18. A Family trust election, revocation or variation 2018 must be completed and lodged with the 2017–18 tax return of the trust.

    Varying the test individual of a family trust election

    If the relevant conditions in section 272-80 of Schedule 2F to the ITAA 1936 are satisfied, the trust may vary an election so a different individual is specified as the individual whose family group is taken into account in relation to the election.

    The variation must be in respect of an income year that occurs during the period:

    • starting at the beginning of the income year specified in the election and finishing at the end of the fourth income year after the income year specified in the election, or
    • starting on 1 July 2007 and finishing on 30 June 2009.

    The trust may only vary the specified individual of a family trust election once, except where doing so under subsection 272-80(5C) of Schedule 2F to the ITAA 1936 in relation to a relevant order, agreement or award mentioned in paragraphs 126-5(1)(a) to (f) of the ITAA 1997.

    Print V in the single box at this item if the specified individual of a family trust election is being varied from a time in 2017–18. A Family trust election, revocation or variation 2018 must be completed and lodged with the 2017–18 tax return of the trust.

    Interposed entity election status

    If the trustee has not made or is not making any interposed entity elections, do not complete this item.

    If the trustee has previously made one or more interposed entity elections specifying a day in an income year before 2017–18, write the earliest income year specified in the box at this item.

    If the trustee is making one or more interposed entity elections this year specifying a day in the 2004–05 or later income year, write the earliest income year specified in the box at this item, and complete an Interposed entity election or revocation 2018 each election specifying a day in the 2004–05 or later income years.

    Revoking an interposed entity election

    An interposed entity election can only be revoked by a trust that satisfies all the relevant conditions in section 272-85 of Schedule 2F to the ITAA 1936.

    Print R in the single box at this item if the interposed entity election made by the trust is being revoked from 2014–15. An Interposed entity election or revocation 2018 must be completed and lodged with the Trust tax return 2018.

    Example 1: New elections, specifying the current year

    The trustee has not previously made a family trust election or an interposed entity election but wants to make a family trust election specifying 2017–18 and make an interposed entity election specifying a day in 2017–18.

    End of example

    Write:

    • 2018 in the box at Family trust election status
    • 2018 in the box at Interposed entity election status.

    Example

    Complete a Family trust election, revocation or variation 2018 specifying the 2017–18 income year.

    Complete an Interposed entity election or revocation 2018 specifying a day in 2017–18.

    Attach the completed forms to the Trust tax return 2018.

    End of example

     

    Example 2: New elections, specifying an earlier year

    The trustee has not previously made a family trust election or an interposed entity election. The trustee decides to make a family trust election specifying 2004–05 and an interposed entity election specifying a day in 2004–05.

    End of example

    Write:

    • 2005 in the box at Family trust election status
    • 2005 in the box at Interposed entity election status.

    Example

    Complete a Family trust election, revocation or variation 2018 specifying the 2004–05 income year.

    Complete an Interposed entity election or revocation 2018 specifying a day in 2004–05.

    Attach the completed forms to the Trust tax return 2018.

    End of example

     

    Example 3: Additional elections, specifying a current year

    The trustee has previously made a family trust election specifying 1996–97 and an interposed entity election specifying a day in 1997–98. The trustee decides to make another interposed entity election specifying a day in 2017–18.

    End of example

    Write:

    • 1997 in the box at Family trust election status
    • 2018 in the box at Interposed entity election status.

    Example

    Complete an Interposed entity election or revocation 2018 specifying a day in the 2017–18 income year.

    Attach the completed form to the Trust tax return 2018.

    End of example

     

    Example 4: Revoking a family trust election

    The trustee previously made a family trust election specifying 2007–08 and is revoking the family trust election from a day in 2017–18. The trustee has not made any interposed entity elections.

    End of example

    Write:

    • 2008 in the box at Family trust election status
    • R in the single box at Family trust election status as the trustee is revoking a family trust election.

    Example

    Complete a Family trust election, revocation or variation 2018

    Lodge the completed form with the Trust tax return 2018

    An interposed entity election is taken to be revoked if the family trust election to which it relates is revoked.

    End of example

     

    Example 5: Varying a family trust election

    The trustee previously made a family trust election specifying 2007–08, and an interposed entity election specifying 2001–02. The trustee is varying the specified individual of the family trust election from the first day in 2017–18.

    End of example

    Write:

    • 2008 in the box at Family trust election status
    • 2002 at Interposed entity election status
    • V in the box at Family trust election status as the trustee is varying the specified individual of a family trust election.

    Example

    Complete a Family trust election, revocation or variation 2018.

    Lodge the completed form with the Trust tax return 2018.

    End of example

    Family trust distribution tax

    A consequence of a trust making a family trust election or an interposed entity election is that under section 271-15 or section 271-20 of Schedule 2F to the ITAA 1936 a special tax, called family trust distribution tax (FTDT), is payable at 47% by the trustee on any conferral of present entitlement to, or distribution of, income or capital of the trust to persons who are not members of the family group of the specified individual within the meaning of section 272-90 of Schedule 2F to the ITAA 1936.

    For this purpose a distribution of income or capital by a trust has the meaning given in sections 272-45 and 272-60 of Schedule 2F to the ITAA 1936.

    The definition of family group includes a former spouse, a former widow or widower, and a former stepchild.

    If FTDT is payable by you, complete the Family trust distribution tax payment advice and post it with your FTDT payment to us at the address shown on the FTDT payment advice. Make cheques or money orders payable to the Deputy Commissioner of Taxation and print ‘Not negotiable’ across the cheque. Tender all cheques in Australian currency. Do not send cash by post.

    Definition of spouse

    Your spouse includes another person (of any sex) who:

    • you were in a relationship with that was registered under a prescribed state or territory law
    • although not legally married to you, lived with you on a genuine domestic basis in a relationship as a couple.
    Interaction between family trust distribution tax and TFN withholding for closely held trust rules

    If you are the trustee of a trust that has made a family trust election or an interposed entity election and make a payment or distribution to a beneficiary that is not subject to FTDT, you need to consider the TFN withholding for closely held trusts.

    For more information, see Appendix 1.

    Type of trust

    Print in the first box at this item the code from table 1 that best describes the type of trust for which the trust tax return is being lodged. Descriptions of the types of trust are at Table 2.

    Table 1: Trust codes

    Code

    Type

    C

    Special disability trust

    D

    Deceased estate

    F

    Fixed trust, other than a fixed unit trust or public unit trust described in U, P or Q

    H

    Hybrid trust

    S

    Discretionary trust, where the main source of income of the trust is from service and/or management activities

    T

    Discretionary trust, where the main source of income of the trust is from trading activities

    I

    Discretionary trust, where the main source of income of the trust is from investment activities

    M

    Cash management unit trust

    U

    Fixed unit trust, other than a public unit trust described in P or Q

    P

    Public unit trust (listed) other than a cash management unit trust

    Q

    Public unit trust (unlisted) other than a cash management unit trust

    Charitable trust

    Print X in the second box at Type of trust if the trust is also a charity.

    Description of trusts

    Table 2: Description of trusts

    Type of trust

    Description

    Deceased estate

    See Appendix 8.

    Discretionary trust

    A trust that is not a fixed trust within the meaning of section 272-5 of Schedule 2F to the ITAA 1936; see also subsection 102UC(4) of the ITAA 1936

    Fixed trust

    A trust in which persons have fixed entitlements (as defined in section 272-5 of Schedule 2F to the ITAA 1936) to all income and capital of the trust at all times during the income year

    Fixed unit trust

    A fixed trust in which interest in the income and capital of the trust are represented by units

    Hybrid trust

    A trust that is not a fixed trust but in which persons have fixed entitlements (as defined in section 272-5 of Schedule 2F to the ITAA 1936) to income or capital of the trust during the income year

    Public unit trust

    A fixed unit trust that is a widely held unit trust (as defined in section 272-105 of Schedule 2F to the ITAA 1936) at all times during the income year

    Public unit trust: listed

    A public unit trust in which any of its units were listed for quotation on the official list of a stock exchange in Australia or elsewhere during the income year

    Public unit trust: unlisted

    A public unit trust in which none of its units was listed for quotation on the official list of a stock exchange in Australia or elsewhere during the income year

    Special disability trust

    A trust that has the meaning given by section 1209LExternal Link of the Social Security Act 1991

    Managed investment trusts

    The trustee of a MIT may make an irrevocable election to apply the capital gains tax (CGT) provisions to determine the tax on gains and losses from the disposal of eligible assets held by the MIT.

    Who is eligible to make an election?

    The trustee of a MIT may make an election. The election must be made in the approved form.

    Making an election

    Trusts that became a MIT prior to 2009–10

    When must a trustee make an election?

    A trustee had to make an election by 2 September 2010. A trustee may make an election by a later date, if the Commissioner allows it.

    When will an election take effect?

    Once a trustee makes the election, it will have effect for 2008-09 and later income years.

    How can a trustee make an election?

    The period in which a trustee can make an election for a trust that became a MIT prior to the 2009–10 income year has now expired.

    However, the Commissioner may, in exceptional circumstances, allow a trustee to make the election upon request.

    Trusts that became a MIT in 2009–10 or a later income year

    When must a trustee make an election?

    A trustee must make an election on or before the latest of the following days:

    • the day the trust is required to lodge its income tax return for the income year in which it became a MIT
    • a later date, if the Commissioner allows it.

    When will an election take effect?

    Once a trustee makes the election, it will have effect for the income year in which the trust becomes a MIT and later income years.

    How can the trust make an election?

    A trustee of an MIT can make an election by answering 'Yes' at Managed investment trusts on the Trust tax return.

    A trustee of an attribution managed investment trust (AMIT) can make an election by answering 'Yes' at Capital account election on the AMIT tax return.

    A trustee must make the election within the relevant timeframe.

    If a trust became a MIT prior to 2009–10 and a trustee of the MIT had previously made an election for capital treatment, the trustee of the MIT must still answer 'Yes' to this question for each year the trustee of the MIT is required to complete a Trust tax return or AMIT tax return.

    For more information, see Managed investment trusts: election into capital treatment.

    Is any tax payable by the trustee?

    The trustee is generally liable to pay tax on:

    • that part of the net income of the trust that has not been assessed to either a presently entitled beneficiary or the trustee on behalf of a presently entitled beneficiary, see Is a beneficiary presently entitled to a share of the income of the trust estate?
    • shares of the net income of a trust in respect of beneficiaries, whether or not the beneficiaries are acting in their capacity as trustee of another trust estate, who are presently entitled to a share of the income of the trust estate but are non-resident at the end of the income year, see Non-resident beneficiaries – additional information
    • shares of the net income of a trust in respect of beneficiaries who are presently entitled to a share of the income of the trust estate but are under a legal disability, see Appendix 10
    • if the trust is a special disability trust and the principal beneficiary is an Australian resident at the end of the income year, the whole of the net income of the trust
    • if an election has been made for the trustee to be assessed on a capital gain of the trust, the amount of the capital gain.

    The rate of tax payable by the trustee will depend on the type of trust and the beneficiary's individual circumstances.

    If the beneficiary is presently entitled to a share of the income of the trust estate, not under a legal disability, and is a resident at the end of the income year, then the beneficiary, not the trustee, is generally taxed on that same percentage share of the net income of the trust. This amount may be different if any beneficiary or the trustee has been made specifically entitled to an amount of franked distribution or capital gains (that is, the capital gain or franked distribution has been streamed to a particular beneficiary).

    If the trustee is liable to pay any tax, print X in the Yes box at this item even if payments have been made in advance. Otherwise, print X in the No box.

    Net income means the total assessable income calculated as if the trustee was a resident taxpayer, less all allowable deductions, except deductions for net farm management deposits, for more information see Appendix 10. In the case of any beneficiary with no beneficial interest in the trust corpus, past losses are required to be met out of corpus.

    Request for a non-taxable advice

    If the trustee is not assessed on income and a non-taxable advice is required, provide a request on a separate sheet of paper headed ‘Request for a non-taxable advice’ and include the trust name and TFN with the details. Sign the request, attach it to the tax return and print X in the Yes box at Have you attached any ‘other attachments’? at the top of page 1 of the tax return.

    Final tax return

    Print X in appropriate box.

    If the trustee does not expect to lodge further tax returns, provide a statement on a separate sheet of paper headed ‘Final trust tax return’ showing:

    • the reason further tax returns will not be lodged, and
    • the manner of disposal of any assets of the trust if not disclosed elsewhere on the tax return.

    Attach the statement to the tax return and print X in the Yes box at Have you attached any ‘other attachments’? at the top of page 1 of the tax return.

    If the trust is a subsidiary member of a consolidated group or MEC group, print X in the No box at Final tax return if membership of the group is the only reason for which the trust will not be required to lodge future returns.

    Electronic funds transfer (EFT)

    Direct refund

    We need your financial institution details to pay any refund owing to you, even if you have provided them to us before.

    Complete the:

    • bank state branch (BSB) number; this six-digit number identifies the financial institution (do not include spaces or hyphens)
    • account number; this number should not have more than nine characters (do not include spaces)
    • account name; your account name should appear on your bank account records. Include spaces between each word and between initials. If your account name exceeds 32 spaces, provide only the characters for the first 32 spaces.

    Direct debit

    The trustee can pay tax owing directly from their account using EFT. A trustee can provide separate account details for direct debit and direct refund.

    To use direct debit

    Trustees can arrange direct debit by using a tax agent who can lodge tax returns through the electronic lodgment service (ELS), or by completing a Direct debit request form. Allow at least five working days for processing of the direct debit request form. Tax agents can transmit payment details up to three working days before the due date once the direct debit request has been processed, for more information, phone 1800 802 308.

    If the trustee used direct debit last year and the account details provided are correct, you do not need to make another request. The notice of assessment will display a message that the tax debt will be debited from the nominated account on the due date.

    If the account details have changed, complete a direct debit request if you want to use direct debit this year.

    A direct debit request remains in force until it is cancelled. Cancellations must be received three business days before the payment date.

    There is no provision for a direct debit election on the tax return. The direct debit request is also available as part of ELS software packages.

    Last modified: 08 Feb 2019QC 55259