Description

The taxation of trusts has been in the spotlight again, most recently following the proposed increase in the trustee tax rate from 33% to 39%. The proposed increase in the trustee tax rate is intended to limit opportunities to circumvent the 39% top personal tax rate.

The proposed change in the trustee tax rate, together with escalating compliance costs, has resulted in advisers reviewing their clients’ trust structures to ensure they are still “fit for purpose”. This review will often result in distributions being made, debts being forgiven, trust property being transferred to other structures, and trusts being varied, resettled or wound up.

These changes will often give rise to tax consequences. It is critical that advisers ensure that their clients are aware of these tax implications and take steps to mitigate them.

ORIGINAL BROADCAST DATE

7 September 2023

LEARNING OUTCOMES

You will:

• Learn about the effect of the proposed 39% trustee tax rate on trust structures, and how to mitigate the impact of that 39% tax rate
• Understand how the bright-line test applies to property held in trust, including recent changes to the “rollover relief” provisions
• Know what tax issues arise on distributions, including the distribution of “deemed income” and imputation credit streaming
• Learn about the GST and income tax implications arising on varying the terms of a trust and trust resettlements
• Understand when debt forgiveness programmes can give rise to a tax liability, including when trusts are resettled

SUITED TO

Accountants of all levels, tax lawyers, trust lawyers and others who act as trustees of clients’ trusts.

PRESENTER

Stephen Tomlinson, Principal, Tomlinson Law.