Jun 2017 2 Minutes

2017 Trustee Resolutions

Trustees are required to have made their 2017 resolutions to distribute trust income on or before 30 June 2017.

It is recommended that the resolution is made in writing and is in a format that is compatible with the respective Trust Deed. A written record will provide better evidence of the resolution and avoid a later dispute with the ATO as to whether any distribution of income was effectively made by 30 June.

If the resolution is not made and signed by 30 June, the ATO may assess the trust income to the trustee at 49%.


The ATO Resolutions Checklist

The ATO has helpfully provided its Resolution Checklist on their website. The key points in that checklist are:

  1. The Resolution must be made by the earlier of the date the Trust Deed requires or 30 June;
  2. The Resolution must be recorded in writing if the Deed requires, however if the Deed is silent the ATO recommend that it is writing “to avoid a later dispute.”
  3. Where Streaming of capital gains and franked dividends is allowed in the Deed, the Resolution must be in writing;
  4. The ATO does not accept distributions of notional amounts (such as franking credits) in line with its “preliminary” views in TR 2012/D1;
  5. The ATO does not accept that income other than capital gains and franked dividends can be streamed to specific beneficiaries, such as rent, interest, foreign income etc.

If you would like any assistance in preparing your 2017 Trust Resolutions please contact Heeral on (08) 9364 9988.