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Edited version of private advice
Authorisation Number: 1051996359000
Date of advice: 29 June 2022
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner exercise his discretion under subsection 99A(2) of the Income Tax Assessment Act 1936 (ITAA 1936) to apply progressive individual rates of tax as per section 99 of the ITAA 1936?
Answer
Yes.
Having considered your circumstances and the relevant factors the Commissioner will apply progressive individual rates of tax under section 99 of the ITAA 1936.
This ruling applies for the following period:
Year ended 30 June 20xx
Year ended 30 June 20xx
Year ended 30 June 20xx
Year ended 30 June 20xx
Year ended 30 June 20xx
Year ended 30 June 20xx
The scheme commences on:
1 July 20xx
Relevant facts and circumstances
The deceased died on xx 20xx and probate issued on xx 20xx.
Administration of the estate had been delayed due to family conflict.
Court orders were given on xx 20xx allowing for the finalization of the estate of the deceased (deceased estate trust) and commencement of the Testamentary Trust.
The deceased estate included the 3 properties below to be transferred to the Testamentary Trust:
The Will directs that the properties be rented with xx% of the net income of the trust to remain in the trust and be accumulated.
The other xx% of net income of the trust is to be fully expended in each financial year for the benefit of the deceased's beneficiaries.
Vesting date is xx years after the date of death of the deceased.
On the vesting date the Executives will divide what is remaining of the balance of the deceased estate between the living children of the deceased's siblings as tenants in common in equal shares.
No loans or privileges have been transferred and conferred upon the trust estate
The executor has no power to make any beneficiary presently entitled to the accumulated income.
Relevant legislative provisions
Income Tax Assessment Act 1936 section 99
Income Tax Assessment Act 1936 section 99A
Income Tax Assessment Act 1936 section 99A (2) & (3)