I have been reading about Blind Trusts and how the beneficiaries don't necessarily have to be named. I haven't been able to find the answer as to who would pay the tax on this trust. Is it that the trust is taxed each year at the highest tax rate?
A blind trust is a particular type of trust in which the executor or other kind of responsible fiduciary third party is empowered to administer the business of the trust without any input from the beneficiary. Along with granting full management discretion, the blind trust also prevents the administrator from providing any information about the day to day operations of the trust to the beneficiary.
Any input would be appreciated.
S
I haven't heard these talked about much in Australia. But if a beneficiary is receiving income from a trust it will be taxable in their hands. If a trustee does not make a distribution the trust income is taxed at the highest rate usually.
Being blind just means the beneficiaries are not named and therefore they can't have any rights to inspect the books etc which a normal beneficiary would.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks Terry. I thought that was the case. I appreciate your response.
Ps. Well done reaching 10000 posts.
OMG, 10k, I didn't even notice.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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