Creation of a new trust - Statement of Principles August 2001


This statement is no longer current. As a result of the decision in Federal Commissioner of Taxation v. Clark and Anor (Clark) [2011] FCAFC 5 and the High Court's refusal to grant the Commissioner leave to appeal that decision, the Statement was withdrawn on Friday 20 April 2012.

For more information, refer to the Decision Impact Statement.

End of attention


This article discusses the Australian Taxation Office's (ATO) view of the impact of the decision of the High Court in Commissioner of Taxation v. Commercial Nominees of Australia Ltd [2001] HCA 33.

Commercial Nominees was a case involving a superannuation fund established by a deed of trust in which the ATO sought guidance from the Courts as to the circumstances in which changes made to a trust alter the nature and character of the trust relationship such that the original trust (and thus, the original taxpayer/entity) ceases to exist and a new trust (that is, a new taxpayer/entity) is created. A number of tax consequences arise if a new trust is created.

In summary, the ATO believes that the High Court has said nothing that is contrary to the Statement of Principles issued on 9 June 1999.

While the ATO has reviewed and updated its Statement of Principles in light of the High Court's decision, the basic concepts underlying the Statement of Principles have not changed.

    Last modified: 20 Apr 2012QC 16266