Taxation Determination

TD 92/159

Income tax: is a beneficiary under a legal disability (for example under 18 or mentally incapacitated) required to lodge a return where a distribution from one trust (other than a corporate or public trading trust) is the beneficiary's only source of income?

  • Please note that the PDF version is the authorised version of this ruling.

FOI status:

may be releasedFOI number: I 1213315

This Determination, to the extent that it is capable of being a 'public ruling' in terms of Part IVAAA of the Taxation Administration Act 1953, is a public ruling for the purposes of that Part. Taxation Ruling TR 92/1 explains when a Determination is a public ruling and how it is binding on the Commissioner. Unless otherwise stated, the Determination applies to transactions entered into both before and after its date of issue.

1 No. Subsection 100(1) of the Income Tax Assessment Act 1936 only requires the inclusion of the trust income in the beneficiary's assessable income where the beneficiary also derives a distribution from another trust estate or derives income from another source.

2 The beneficiary is not required to declare the trust income and therefore the lodgment of the beneficiary's individual return is not necessary.

3 The trustee is liable for the tax assessed on the beneficiary's share of the net trust estate income under subsection 98(1).

Note: The distribution is also not included as assessable income under paragraph 26(b) because the trustee is assessed and liable to pay tax in pursuance of section 98.

Example: An under 18 beneficiary's only source of income is a single trust distribution of $10000. The beneficiary is not required to lodge a return.

Commissioner of Taxation

Previously Draft TD 92/D114


ATO references:

ISSN 1038 - 3158

Subject References:
legal disability;
single source trust distribution

Legislative References:
ITAA 98(1);
ITAA 100(1)