Tax Avoidance Taskforce – Trusts
In the 2013–14 Budget, the government announced it would provide funding over four years for a multi-agency taskforce. This taskforce would take compliance action against taxpayers involved in tax avoidance or evasion using trusts. From 1 July 2017, this work continues under the operational umbrella of the Tax Avoidance Taskforce.
This information is for taxpayers, tax professionals and the wider community who may be concerned about risky arrangements involving the use of trusts for tax avoidance or evasion. We set out how the ATO and other agencies are taking action in response to evidence of increased manipulation of trusts as vehicles for tax avoidance or evasion.
If you're concerned about the implications of your tax planning arrangements, you can seek independent professional advice, contact us or make a voluntary disclosure.
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Tax Avoidance Taskforce – Trusts: what we do
The Tax Avoidance Taskforce – Trusts continues the work of the Trusts Taskforce. It does this by targeting higher risk trust arrangements in privately owned and wealthy groups. These are not ordinary trust arrangements or tax planning associated with genuine business or family dealings.
We recognise that most trusts are used appropriately. We will continue to help those who make genuine mistakes or are uncertain about how the law applies to their circumstances.
We have a number of trust risk rules in place to identify higher risk compliance issues. Most trusts do not trigger these risk rules.
Our priorities in relation to trusts are to:
- undertake focused compliance activity on privately owned and wealthy groups involved in tax avoidance and evasion arrangements using trust structures
- target known tax scheme designers, promoters, individuals and businesses who participate in such arrangements
- lead cross-agency action to pursue the most egregious cases of tax abuse using trusts
- undertake projects to gather intelligence on and deal with specific risks.
We aim to build community confidence and encourage voluntary compliance by publicising our activities in relation to trusts and undertaking education projects to improve voluntary compliance.
We focus on the following risks:
- lodgment of trust tax returns
- complex distributions
- trust and taxable income mismatches
- unidentified beneficiaries
- cross border and international risks
- avoidance and evasion.
Agencies involved
As well as the ATO, the Tax Avoidance Taskforce – Trusts works closely with the following agencies: