Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-3 - CAPITAL GAINS AND LOSSES: SPECIAL TOPICS  

Division 126 - Same-asset roll-overs  

Subdivision 126-G - Transfer of assets between certain trusts  

Operative provisions

SECTION 126-260   Giving information to beneficiaries  

Beneficiaries must be given particulars of the roll-over

126-260(1)    
If the roll-over is chosen, the trustee of the transferring trust must, within 3 months after the end of the transfer year, send written notice of the particulars set out in subsection (2) to each of the trust's beneficiaries:

(a) by post to the address most recently notified by the beneficiary as the beneficiary's address; or

(b) by any other means notified by the beneficiary for receiving correspondence from the trust.

Note:

The trustee may also notify beneficiaries of other details of the roll-over.

The particulars that must be given

126-260(2)    
The particulars are as follows:

(a) the roll-over asset's transfer time;

(b) sufficient information to enable a beneficiary to work out which of the beneficiary's *membership interests in the receiving trust correspond to each of the beneficiary's membership interests in the transferring trust;

(c) the *market value of each of the membership interests held by the beneficiary in the transferring trust just after the roll-over asset's transfer time, or a reasonable approximation of that market value;

(d) the market value of each of the membership interests held by the beneficiary in the transferring trust just before the roll-over asset's transfer time, or a reasonable approximation of that market value.

Offence

126-260(3)    
A trustee commits an offence if the trustee contravenes subsection (1).

Penalty: 30 penalty units.

126-260(4)    
An offence against subsection (3) is an offence of strict liability.

Note:

For strict liability, see section 6.1 of the Criminal Code .

If the transferring trust has multiple trustees

126-260(5)    
If the transferring trust has 2 or more trustees, the obligation imposed by subsection (1) is imposed on each of the trustees, but may be discharged by any of the trustees.

Note:

Each of the trustees commits an offence against subsection (3) if none of them discharges the obligation imposed by subsection (1).

126-260(6)    
In a prosecution of a trustee for an offence against subsection (3) for an act or omission contravening subsection (1), it is a defence if the trustee proves that the trustee:

(a) did not aid, abet, counsel or procure the act or omission; and

(b) was not in any way knowingly concerned in, or party to, the act or omission (whether directly or indirectly and whether by any act or omission of the trustee).

Note:

A defendant bears a legal burden in relation to the matters in subsection (6): see section 13.4 of the Criminal Code .

Obligations of beneficiary unaffected if not notified of roll-over

126-260(7)    
A failure by a trustee to comply with subsection (1) does not affect the application of section 126-245 to the beneficiary.