Chris and Elaine Get Their Rollover All Wrong

Discussion in 'Accounting & Tax' started by Mike A, 1st Jan, 2020.

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  1. Mike A

    Mike A Well-Known Member

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    Welcome to 2020. Yes the first post for the New Year.

    Learn how a rollover went wrong for poor Chris and Elaine.

    Chris and Elaine are operating a successful wedding planning business through a hybrid unit trust. They have been looking into restructuring to a company and has decided this will be the year to do so.

    They go and see their accountant and learn they can do a unit trust to company rollover (124-N rollover is the technical bit). So away they go and do the rollover and pay no tax. Happy days.

    During an audit they find out that the trust wasn't eligible for the rollover !! Sacre bleu !!! What should Chris and Elaine have done prior to doing the rollover. A simple step but one that could easily be missed.
     

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    Mike A, 1st Jan, 2020
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  2. money

    money Well-Known Member

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    Please share what the step is as it seems nobody else knows the answer :)
     
    money, 4th Jan, 2020
    #2