The law has changed how trustees of closely held trusts report beneficiaries' tax file numbers (TFNs), if they're entitled to a distribution.
From 1 July 2026, trustees of closely held trusts must now report beneficiary TFNs in the statement of distribution when completing the annual trust tax return.
TFN reporting up to 30 June 2026
Beneficiaries of closely held trusts are required to quote their TFN to the trustee before they receive a payment or are entitled to trust income. Where a TFN is not quoted, there is a requirement on the trustee to withhold at the top tax rate.
Trustees were required to lodge a quarterly TFN report for beneficiaries that had quoted their TFN by the last day of the month following each quarter in which the TFN was quoted. The final TFN report for the April–June 2026 period is due by 31 July 2026.
Changes from 1 July 2026
From 1 July 2026, trustees of closely held trusts are no longer a required to lodge a quarterly TFN report for periods after 30 June 2026.
Trustees must now report beneficiary TFNs in the statement of distribution when completing the Trust tax return. Additional labels will be included on the Trust tax return from 2027 to support circumstances where a TFN has not been provided.
There's no change to existing TFN withholding and reporting obligations of trustees where a beneficiary has not quoted their TFN before receiving a payment from the trust or entitlement to trust income.
We'll keep you updated with more news coming soon.
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