Family trusts: tips for electing entities

Are you one of the following electing entities:

• a trustee of a family trust who has made a family trust election (FTE)
• an entity with an interposed entity election (IEE)?

If you are, then in the lead up to 30 June, it's important for you and your adviser to act now to lower the risk of FTDT liabilities arising.

Watch and share our short video, presented by Deputy Commissioner Louise Clarke, for an overview of our key FTDT tips.

You can find more detailed tips below, as well as links to key resources on our website.

Tip 1: Do you need your elections?

We recommend that you review your FTEs and IEEs and consider the need to vary the specified individual or revoke an election.

Once you make an election, you can only vary or revoke it in limited circumstances.

For FTEs, you can vary the specified individual once, subject to certain conditions. These include that, generally:

• the new specified individual is a member of the original specified individual's family group
• there have been no conferrals of present entitlement or distributions of income or capital outside the new specified individual’s family group.

You can revoke an FTE where the family trust is a fixed trust, or the FTE wasn't required to do any of the following:

• recoup tax losses
• deduct bad debts
• access franking credits (subject to satisfying certain conditions).

Generally, you:

• can make variations and revocations until the end of the fourth income year after the income year specified in the original election
• are required to make variations and revocations with the entity's tax return for the income year it's to be effective.

To find out more about variations and revocations, visit our family trusts information.

Tip 2: Know the family group

That is, know all the individuals and entities, including corporate beneficiaries, who are part of the ‘family group’. There's a strict legal definition of family group. It’s based on who the members of the 'specified individual’s' family group are.

This is important now as you make year-end distribution decisions. Where you make distributions outside the family group, it will attract FTDT at 47% payable by a trustee, director, or partner.

Tip 3: Review your record keeping

It's important you check you have strong governance and record-keeping practices. This includes for:

• all elections you've made
• members of the family group
• distributions.

This is even more important if you've changed tax agent.

You need to maintain your records (e.g. written records of the original FTE and IEE) for at least 5 years after their final lodgment obligations with us. In addition, you must include the specified income year from your FTE and IEEs on your tax return each year your election remains in force.

To support tax agents, our Online service for agents ‘Family trust and interposed entity elections report’ displays details about elections. From 18 April 2026, we've enhanced this report to include more information about all elections lodged with us, including the date lodged.

To find out more about this report and the enhancements, visit increased visibility for trust elections.

We display elections as they're lodged with us. We form no opinion about the validity of the elections displayed in our online report.

Tip 4: Act now for GIC remission on late-paid FTDT

As we advised in August 2025, we’re providing a General Interest Charge (GIC) remission offer up to 30 December 2026. Here we may remit up to 80% of the GIC on FTDT liabilities. This is if you proactively self-review, identify and pay your FTDT liabilities without our engagement.

The clock is ticking! Be sure to start your self-review soon so there's time for you to pay any outstanding FTDT liabilities.

To find out more about this offer, visit our family trusts information.

Tip 5: Use our website to stay up to date

We’re here to help and have detailed resources available.

Use our family trusts information as an ongoing resource. On that page, you'll also find our webinar about family trust rules.