Discretionary trust estate

Under section 102AAB of the ITAA 1936, discretionary trust estate means a trust estate where the distribution of income or corpus to beneficiaries is made at the discretion of the trustee.

A discretionary beneficiary has no interest in the trust property or income until the trustee exercises its discretion in favour of the beneficiary. A discretionary beneficiary only has the right to be considered when the trustee is exercising this discretion.

    Last modified: 21 Feb 2012QC 25356