ATO Interpretative Decision
ATO ID 2008/10
Income Tax
Transferor trusts: attribution of income to executor of estate of deceased transferorFOI status: may be released
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This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Can income of a non-resident trust estate be attributed under section 102AAZD of the Income Tax Assessment Act 1936 (ITAA 1936) to a trustee of the deceased estate of a natural person who was an attributable taxpayer in relation to a non-resident trust estate, in the year of the person's death?
Decision
No, the income of a non-resident trust estate cannot be attributed under section 102AAZD of the ITAA 1936 to the trustee of the deceased estate (the executor) of a person who transferred property or services to a non-resident trust, because the executor is not an attributable taxpayer.
Facts
A natural person (the taxpayer) was an attributable taxpayer in relation to a non-resident trust estate in a particular year of income. The taxpayer died part way through the financial year (1 July to 30 June).
Reasons for Decision
An entity is an attributable taxpayer in relation to a year of income if the entity has transferred property or services to a non-resident trust (sub-subparagraph 102AAT(1)(a)(i)(C) or sub-subparagraph 102AAT(1)(a)(ii)(B) of the ITAA 1936).
The executor of the estate of a deceased attributable taxpayer is generally not an attributable taxpayer unless the executor has transferred property or services to a non-resident trust estate through the exercise of a power of appointment or of a discretion by the executor.
There are no 'successor' rules for the case of the death of a natural person who has transferred property or services. That is, no provision deems an executor to be an attributable taxpayer when a previous transfer of property or services was made by the deceased taxpayer.
In the absence of 'successor' rules, the executor of the deceased estate, having a separate legal personality to the taxpayer, cannot be subject to attribution by virtue of a previous transfer of property or services by the taxpayer.
Amendment History
| Date of Amendment | Part | Comment |
|---|---|---|
| 24 October 2014 | Issue | Insert 'estate' after 'non-resident trust' |
| Facts | Change to consistent use of past tense | |
| Reason for Decision | Reword second paragraph for clarity |
Year of income: Year ending 30 June 2008
Legislative References:
Income Tax Assessment Act 1936
section 102AAT
section 102AAZD
ATO ID 2008/9
Keywords
Deceased estates
Executors
Non resident trusts
Trusts
Date reviewed: 23 October 2017
ISSN: 1445-2782
| Date: | Version: | |
| 13 December 2007 | Original statement | |
| You are here | 24 October 2014 | Updated statement |
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