A former PPF distributing under the transitional rules must as a minimum:
- distribute during a financial year 5% of each gift received in the previous financial year
- distribute its trust income within the financial year in which it is derived, unless otherwise allowed by the Commissioner.
A former PPF distributing under the transitional rules can retain an amount of trust income to maintain the capital of the fund calculated at the start of a financial year to reflect movements in the CPI published by the Australian StatisticianExternal Link for the previous financial year.
If the fund is subject to a continuing agreed accumulation plan, it may continue to act in accordance with that plan until one of the following occurs:
- when the plan expires
- when the fund meets its target amount
- the end of the 2013–14 financial year
the start of a financial year for which the fund chooses to not apply the transitional rules.
For more information, refer to private AF guidelines 52 to 55.