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ABN & TFN for Trust and Trustee?

Discussion in 'Accounting & Tax' started by SOULFLY3, 25th Sep, 2015.

  1. SOULFLY3

    SOULFLY3 Well-Known Member

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    As per my title,
    I have my current accountant saying both the trust and the trustee require an ABN and TFN. for EOFY tax purposes.

    I spoke with my solicitor and her accountant said only Trustee requires abn & tfn .

    The trust if a discretionary family trust

    any help would be great as this is so confusing

    Thanks!
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    Just the Trust needs ABN / TFN.

    It may not even need ABN depending on what it's doing.
     
  3. SOULFLY3

    SOULFLY3 Well-Known Member

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    Thanks DT, (im not good with any of this tax stuff!)
    But Its set up for a development
     
  4. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Where a company acts solely as a trustee for a trust it does not need a TFN and it has NO entitlement to a ABN as it does not conduct an enterprise and / or make supplies. It just complicates things and the ATO start sending things to the entity in its own right as well as trustee and confuses everything. I def do not recommend the trustee have a TFN or ABN.

    The Trust will need a TFN and if its doing a dev it will definately need a ABN as well. This will all be needed for income tax, contractor payments reporting !! as well as possible GST registration if a sale is contemplated in the future. The ABN can easily have GST added at a later time if required. I generally advise my dev client to defer the GST regn until sales are ready to happen and contract are being drawn up (ie margin scheme)
     
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  5. SOULFLY3

    SOULFLY3 Well-Known Member

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    Thanks Paul :)
    Makes sense, Thanks for your help and the chat on the phone
     
  6. MRO

    MRO Well-Known Member

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    Maybe time for a new accountant?
     
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  7. MikeLivingTheDream

    MikeLivingTheDream BCOM MCOM MTAX CPA CTA Registered Tax Agent

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    Disagree actually paul. When we did the voluntary disclosures the senior tax counsel advised that the trustee and the trust needed a TFN. The trust would lodge a return. The trustee a return not necessary. We have always followed that protocol. Terry can confirm he also had similar discussions with another senior tax counsel from the ATO. Frank egan would actually have the file notes and i know you know him paul. But the advice we have been provided is that both need a TFN. None may need an ABN. Why would you get a new accountant when that advice may in fact be correct.
     
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  8. D.T.

    D.T. Adelaide Property Manager Business Member

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    o_ONone of my trustees have ever had TFN's
     
  9. MikeLivingTheDream

    MikeLivingTheDream BCOM MCOM MTAX CPA CTA Registered Tax Agent

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    Yes i held the same view until about 4 years ago when doing the ato voluntary disclosures. As discussed terryw had the same discussion with a senior lawyer at the ATO about 8 months ago and they confirmed the trustee needed a TFN. Since then we do them for all of them. Cant see the point to be honest and you just ending up doing a return not necessary in the first year. But thats what the ATO has advised us.
     
    Last edited: 25th Sep, 2015
  10. MikeLivingTheDream

    MikeLivingTheDream BCOM MCOM MTAX CPA CTA Registered Tax Agent

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    Paul

    Im confused if they are doing a development why would you wait until sale for registering for GST ? If for development purposes you would be claiming the input tax credits each quarter which assists most developers with their cashflow.
     
  11. JacM

    JacM VIC Buyer's Agent Business Member

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    If your accountant doesn't know, then they should not be the accountant for this entity.

    Your paid professionals should be smarter than you on the topic you pay them for.
     
  12. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    I would suggest a trustee company that does nothing other than acting as trustee should get a TFN. There are limited exemptions for not having to get a TFN. If an entity is not required to lodge a tax return then no TFN is needed because of s202EC ITAA36
    http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1936240/s202ec.html

    It is my understanding that even a non trading company would need to lodge a tax return - a nil one in this case. So I think it should have a TFN.

    If the TFN is not needed then no harm is done.