All Topics / Legal & Accounting / ATO Taxpayer Alert on ‘Hybrid Trusts’

Viewing 1 post (of 1 total)
  • Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    The ATO has just issued an alert which covers certain Hybrid Trusts:

    TA 2008/3
    Uncommercial use of certain trusts
    http://law.ato.gov.au/atolaw/view.ht…/NAT/ATO/00001

    From the end of the document:
    The Tax Office considers that the arrangement outlined above may give rise to taxation issues that include:

    1.
    whether, and the extent to which, the taxpayer's borrowing costs are deductible under section 8-1 or section 25-25 of the Income Tax Assessment Act 1997 (ITAA 1997);
    2.
    whether a capital gain could arise under the capital gains tax provisions in Part 3-1 of the ITAA 1997 when trust interests are redeemed or new interests are issued;
    3.
    whether the taxpayer has 'created' a trust in which the taxpayer or their children have an interest, such that the trust may be subject to section 102 of the Income Tax Assessment Act 1936 (ITAA 1936); and
    4.
    whether the general anti-avoidance provisions in Part IVA of the ITAA 1936 may apply to the arrangement, on the basis that its dominant purpose is to enable the taxpayer to obtain a tax benefit.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

Viewing 1 post (of 1 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.