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Edited version of your private ruling
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Ruling
Subject: Commissioner's discretion under subparagraph 272-5(3) ITAA 1936
Question 1
Will the Commissioner exercise his discretion under subsection 272-5(3) of Schedule 2F to the ITAA 1936 such that the beneficiaries of Trust A will have a fixed entitlement.
Answer
Yes
This ruling applies for the following periods:
1 July 2011 to 30 June 2015
The scheme commences on:
12 March 2012
Relevant facts and circumstances
The client is the trustee of Trust A.
Trust A is a registered managed investment scheme under the Corporations Act.
The Constitution of Trust A states that the Constitution is subject to the Corporations Act, ASX Listing Rules and the regulatory powers of ASIC.
The Constitution provides all eligible unit holders with a vested interest to the income and capital of Trust A.
The Constitution contains some clauses that may defease the interest of the unit holders.
It is considered unlikely that the clauses that may cause the defeasance happening will occur.
Relevant legislative provisions
Subsection 272-5(3) of Schedule 2F to the ITAA 1936
Reasons for decision
After having regard to the factors contained in paragraph 272-5(3)(b) of Schedule 2F to the ITAA 1936, the Commissioner considers that the beneficiaries should be treated as having fixed entitlements to the income and capital of the trust.
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