ATO releases decision impact statement for Aussiegolfa

ATO releases decision impact statement for Aussiegolfa

 

not much of an impact i think

 

An interesting outcome but obviously very dependent upon the circumstances.

Had the property not been leased to other parties (to establish market rent etc) prior to the related party transaction, there may have been a different outcome dependent of course upon whether the rent could be seen as a market rent, the member's interpretation on the day and the wind direction etc. It does provide a little bit of wriggle room (if it isn't overturned).

 

The Aussie Golfa case had massive implications for those working in trust law.

Importantly the creation of a new trust by the prescence of a subtrust is tending to indicate that the courts are taking the position of the ATO on trust splitting - TD 2018/D3

This is because if a trust is an arrangement between people about what happens to an item of property that arrangement cannot be split into parts.

The use of trust splitting is a massive estate planning tool and Aussie Golfa is primarily a trust law case. It has wide implications for those in succession planning for family businesses.

The Tax Institute response to TD 2018/D3 can be found here. I helped draft the document as part of my role on the National SME Committee - but Stephanie is the author.

The concessional approach by the ATO for managed funds is awesome.

While the decision provides useful guidance on the factors that may be considered in determining whether a separate trust has been created, the ATO does not expect that this case will have a significant impact on traditional multi-class managed funds. For example, a single trust with multiple classes will be entitled to make the Attribution Managed Investment Trust multi-class election under section 276-20 of the Income Tax Assessment Act 1997, where the requirements of that section are otherwise satisfied.