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14 Other Australian income and 15 Total of items 5 to 14

Instructions to complete items 14 other Australian income and 15 Total of items 5 to 14 in the trust tax return.

Published 30 May 2024

14 Other Australian income

Show at label O the total amount of other Australian income.

If the amount is a loss, show L in the box at the right of the amount. The following are some examples of the amounts to be included at label O:

Excepted net income

Show at label Excepted net income and include at label O the excepted net income received, excluding net capital gains that are included at item 21 Capital gains – label A Net capital gain.

Provide a statement on a separate sheet of paper:

  • detailing the distribution of excepted income to each beneficiary, and
  • listing each beneficiary who is considered to be an excepted person, giving supporting reasons.

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

For an explanation of excepted income and excepted person, see Appendix 9.

Gains on the disposal of traditional securities

Show at label O any gains on the disposal or redemption of a traditional security which are assessable under section 26BB of ITAA 1936.

For more information on gains and losses on traditional securities, including traditional securities that are convertible notes or exchangeable notes, see You and your shares 2024.

Bonuses from life insurance companies and friendly societies

Life insurance policies are issued by life insurance companies and friendly societies.

If, during the year ended 30 June 2024, the trust received any bonuses or other amounts in the nature of bonuses on the maturity, forfeiture, partial or full surrender of a short-term life insurance policy taken out after 27 August 1982, you may need to show the amount at label O.

A trust is regarded as having received a bonus if it reinvests or otherwise deals with the bonus during the income year.

Don't include the amount shown on a bonus certificate if the trust:

  • received it because of death, accident, illness or other disability suffered by the person on whose life the policy was effected
  • received it under a policy held by the trustee of a complying superannuation fund, a complying approved deposit fund or a pooled superannuation trust
  • can show that the amount was received because of serious financial difficulties
  • received a bonus certificate in respect of an amount allocated to increase the amount receivable on surrender or maturity.

If the policy has a date of commencement of risk on or before 27 August 1982, any bonuses received in 2023–24 are not assessable.

If the policy has a date of commencement of risk after 7 December 1983, include any bonus in assessable income as follows:

  • if received during the first 8 years after the date of commencement of risk of the policy, the bonus is included in full
  • if received in the ninth- year, two-thirds of the bonus amount is included
  • if received in the 10th year, one-third of the bonus amount is included, and
  • any amounts received after the 10th year are not included.

If, during the term of the policy, the amount of a premium increases by more than 25% over the previous year’s premium, the policy is taken to have started again with a commencement date at the beginning of the policy year in which the premium increased.

The beneficiary or trustee may, in their own tax return, claim a tax offset for a bonus or any other amount in the nature of a bonus included in the income if the organisation issuing the life policy is a:

  • life insurance company that pays tax on the income from which the amount was paid, or
  • friendly society.

The tax offset for 2023–24 is equal to 30 c in each dollar.

Include the bonus or other amount in the nature of a bonus in the calculation of net income or loss of the trust and apportion it among the beneficiaries in the same ratio as they share in that net income or loss.

If the trust received assessable bonuses from a life insurance company or friendly society, show the total amount at label O. To ensure the tax offset is allowed, provide a statement showing the amounts from the life insurance company and friendly society life insurance policies and attach the statement to the tax return. Print X in the Yes box at Have you attached any ‘other attachments’? at the top of the tax return.

Record keeping

If a bonus or other amount in the nature of a bonus is included at label O, or an amount was not included because of the circumstances under which it was received, keep a record of the following:

  • type of policy
  • name of the issuing organisation
  • policy number
  • date the policy was taken out
  • bonus statement or advice
  • date that each amount was received
  • nature of each amount received – for example, bonus, loan or withdrawal
  • circumstances under which each amount was received, for example, partial surrender of policy, serious financial difficulties, death, accident, illness or other disability
  • basis of calculation of the amount included.

For more information on bonuses received from certain life insurance policies, see Taxation Ruling IT 2346 Income tax: bonuses paid on certain life assurance policies – section 26AH – interpretation and operation.

For more information on amounts switched between investment options for the same life insurance policy, see Taxation Determination TD 94/82 Income tax: does section 26AH of the Income Tax Assessment Act 1936 apply when investment options are ‘switched’ under an eligible policy?

Bonuses credited from friendly society income bonds

Include bonuses received from friendly society income bonds at label O. The statement of distribution issued by friendly societies to income bond holders will advise the amount that should be included as income. Don't include these amounts in the calculation of the tax offset applicable to bonuses from life insurance policies.

Add backs: Listed investment company (LIC) capital gain

If the trust receives or is entitled to receive income from another trust or a distribution from a partnership which advises it has claimed a deduction for a LIC capital gain amount, the trust is required to add back as income an amount equivalent to its share of the deduction allowed to the partnership or other trust.

Royalties

For information on royalty income shown at label O, see Appendix 2.

Foreign exchange gains or losses

Show at label O assessable Australian source foreign exchange gains or deductible losses that you have not included elsewhere, such as in item 5 Business income and expenses. If the total amount at label O is a loss, print L in the box at the right of the amount.

For more information, see Foreign exchange gains and losses.

As foreign currency is a CGT asset, the capital gains tax provisions can apply to any capital gain or capital loss made on a CGT event. Any capital gain would generally be ignored or reduced to prevent double taxation if the gain was assessable under the TOFA rules or Division 775 of the ITAA 1997.

If a trust has made a foreign exchange gain or loss which is subject to CGT, show the capital gain or capital loss at item 21 Capital gains – label A Net capital gain.

TOFA amounts from financial arrangements

If the TOFA rules apply to calculate an assessable gain or deductible loss on the trust’s financial arrangements, include at this item those assessable gains relating to the financial arrangements.

TOFA amounts that have been included elsewhere should not be included here – for example, amounts that have already been included at:

  • item 5 Business income and expenses – label S Net income or loss from business
  • item 8 Partnerships and trusts – label A Distribution from partnerships
  • item 8 Partnerships and trusts – label Z Share of net income from trusts
  • item 11 Gross interest – label J
  • item 12 Dividends – label K Unfranked amount
  • item 23 Other assessable foreign source income – label B Gross.

If the TOFA rules apply to the trust and the other Australian income shown at label O or any other income item includes an amount which is brought to account under the TOFA rules, also complete item 31 Taxation of financial arrangements (TOFA).

For more information, see Guide to taxation of financial arrangements (TOFA).

15 Total of items 5 to 14

Show at item 15 Total of items 5 to 14 the total of all Australian income. If this amount is a loss, print L in the box at the right of the amount.

Continue to: Instructions for trust tax return items 16 to 32

Return to: Instructions to complete the Trust tax return 2024

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