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Edited version of private advice
Authorisation Number: 1052107785315
Date of advice: 17 April 2023
Ruling
Subject:Deceased estate
Question:
Will the Commissioner exercise their discretion under subsection 99A(2)of the Income Tax Assessment Act 1936(ITAA 1936) to tax the trustee on net income that no beneficiary is presently entitled to under section 99 of the ITAA 1936?
Answer:
Yes.
After consideration of the relevant factors, the Commissioner is of the opinion that it would be unreasonable that section 99A of the ITAA 1936 should apply in relation to the Trustee of the Testamentary Trust in the relevant income years. Accordingly, section 99 of the ITAA 1936 will apply.
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
The deceased passed away XX April 20XX. The deceased's two children are the executors of the Estate.
As per the will of the deceased, the Testamentary Trust, was established.
As per the will of the deceased, the share of the Estate was one part of the rest and residue. Estate funds were transferred to the Testamentary Trust in June 20XX.
No income was generated in the 20XX income year.
The Testamentary Trust will retain any profit and re-invest any net proceeds in the Trust.
Relevant legislative provisions
Income Tax Assessment Act 1936 section 99A
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