Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-25 - PARTICULAR KINDS OF TRUSTS  

Division 275 - Australian managed investment trusts: general  

Subdivision 275-A - Meaning of managed investment trust  

Operative provisions

SECTION 275-10   Meaning of managed investment trust  

275-10(1)    
A trust is a managed investment trust in relation to an income year if any of the following requirements are met:

(a)    the trust is covered under subsection (3) of this section in relation to the income year (ordinary case);

(b)    the trust is covered under section 275-45 in relation to the income year (only members of trust are managed investment trusts etc.).

275-10(2)    
A trust is also a managed investment trust in relation to an income year if any of the following requirements are met:

(a)    the trust is covered under section 275-50 in relation to the income year (no fund payment made in relation to the income year);

(b)    the trust is covered under section 275-55 in relation to the income year (temporary circumstances outside the control of the trustee).

275-10(3)    
A trust is covered under this subsection in relation to an income year if:

(a)    at the time the trustee of the trust makes the first *fund payment in relation to the income year, or at an earlier time in the income year:


(i) the trustee of the trust was an Australian resident; or

(ii) the central management and control of the trust was in Australia; and

(b)    the trust is not a trust covered by subsection (4) (trading trust etc.) in relation to the income year; and

(c)    at the time the payment is made, the trust is a managed investment scheme (within the meaning of section 9 of the Corporations Act 2001 ); and

(d)    at the time the payment is made:


(i) the trust is covered by section 275-15 (trusts with wholesale membership); or

(ii) if the trust is not covered by section 275-15 - the trust is registered under section 601EB of the Corporations Act 2001 ; and

(e)    the trust satisfies, in relation to the income year:


(i) if, at the time the payment is made, the trust is registered under section 601EB of the Corporations Act 2001 and is covered by section 275-15 - either or both of the widely-held requirements in subsections 275-20(1) and 275-25(1) ; or

(ii) if, at the time the payment is made, the trust is so registered and is not covered by section 275-15 - either or both of the widely-held requirements in subsections 275-20(2) and 275-25(1) ; or

(iii) if, at the time the payment is made, the trust is not so registered and is covered by section 275-15 - the widely-held requirements in subsection 275-20(1) ; and

(f)    the trust satisfies the closely-held restrictions in subsection 275-30(1) in relation to the income year; and

(g)    if the trust is covered by section 275-15 at the time the payment is made - it satisfies the licensing requirements in section 275-35 in relation to the income year.

Trading unit trust or other trust carrying on trading business etc. cannot be managed investment trust

275-10(4)    
A trust is covered by this subsection in relation to an income year if:

(a)    in the case of a unit trust - the trust is a trading trust for the purposes of Division 6C of Part III of the Income Tax Assessment Act 1936 in relation to the income year; or

(b)    in any other case - the trust at any time in the income year:


(i) carried on a trading business (within the meaning of that Division); or

(ii) controlled, or was able to control, directly or indirectly, the affairs or operations of another person in respect of the carrying on by that other person of a trading business (within the meaning of that Division).

275-10(4A)    


In determining whether a trust is covered by subsection (4) , disregard any interest that the trust has in an *AFOF, an *ESVCLP or a *VCLP unless:

(a)    the trust is a *general partner of the AFOF, ESVCLP or VCLP; or

(b)    the trust has *committed capital in the partnership that, taken together with the sum of the amounts of committed capital in the partnership of any of that partner ' s *associates (other than associates to whom subsection (4B) applies), exceeds 30% of the partnership ' s committed capital.


275-10(4B)    


This subsection applies to:

(a)    an *ADI; or

(b)    a *life insurance company; or

(c)    a public authority:


(i) that is constituted by a law of a State or internal Territory; and

(ii) that carries on life insurance business within the meaning of section 11 of the Life Insurance Act 1995 ; or

(d)    a widely-held complying superannuation fund within the meaning of section 4A of the Pooled Development Funds Act 1992 ; or

(e)    a *widely held foreign venture capital fund of funds.



Crown entities etc.

275-10(5)    


For the purposes of paragraphs (3)(d) and (e) , treat an entity as registered under section 601EB of the Corporations Act 2001 at the time the payment is made if at that time the trust is operated by:

(a)    an entity that would, but for subsection 5A(4) of that Act (about the Crown not being bound by Chapter 6CA or 7 of that Act), be required under that Act to be a financial services licensee (within the meaning of that Act) whose licence would cover operating such a managed investment scheme; or

(b)    an entity that:


(i) is a *wholly-owned subsidiary of an entity of a kind mentioned in paragraph (a) ; and

(ii) would, but for any instrument issued by ASIC under that Act that has effect in relation to the entity and operation of the scheme mentioned in paragraph (3)(c) , be required under that Act to be a financial services licensee (within the meaning of that Act) whose licence would cover operating such a managed investment scheme.


Start-up and wind-down phases

275-10(6)    
Treat the requirements in paragraphs (3)(e) and (f) as being satisfied if:

(a)    the trust is created during the period:


(i) starting 12 months before the start of the income year; and

(ii) ending at the end of the income year; or

(b)    the trust ceases to exist during the income year, and was a *managed investment trust (disregarding paragraph (a) of this section) in relation to the previous income year.


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