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Trustee liabilities

Instructions to complete any liabilities of the trustee of the CCIV sub-fund trust.

Published 30 May 2024

Trustee of the CCIV sub-fund

The trustee of a CCIV sub-fund trust is liable to pay income tax on certain amounts.

It is important you show the taxable amount at each item. That is, the amount on which you are liable to pay tax. Don't enter the amount of tax to be paid. We will apply the relevant tax rate to the amount entered.

Where the trustee of a CCIV sub-fund trust is liable to pay tax, the amount of tax payable by the trustee will be set out in a notice of assessment issued to the trustee.

If the trustee is liable to pay tax under sections 276-405, 276-410 or 276-415 of the ITAA 1997, the Commissioner may fully or partially remit the tax, under section 276-430, if satisfied that there is no detriment to the revenue.

For example, remission of tax may be considered to the extent that a shortfall of an income character or an over of a non-refundable tax-offset character would have been attributed to tax-exempt entities.

Submit any requests for the exercise of the Commissioner's discretion to remit income tax under section 276-430 via the Online services for business Secure mail or the Online services for agents Client communication and include the reasons for your request.

Is any tax payable by the trustee?

Under the CCIV regime, the members, not the trustee, are generally taxed on amounts of an assessable income character attributed to them and entitled to credits from attributed tax offset amounts.

However, there are situations where tax may also be payable by the trustee, typically in respect of amounts of an income character that have been under-attributed to members, or amounts of a tax offset character that have been over-attributed to members.

If the trustee is liable to pay tax in respect of any trustee liabilities, answer Yes at this question even if payments have been made in advance.

Trust component deficit of character relating to tax offset

You must adjust trust components for unders, overs and rounding adjustments under sections 276-305, 276-310 and 276-315 of the ITAA 1997. If the net adjustment would result in a trust component being a negative amount, the trust component is reduced to zero and there will be a trust component deficit equal to the remaining adjustment amount under section 276-320.

If the deficit relates to a tax offset (other than foreign income tax offsets), the trustee is required to pay tax on the deficit under section 276-340. This recognises that the overall amount of that offset previously attributed to members, is more than the tax offset of the AMIT.

Write at this item the total of any amounts you are liable to pay tax on under section 276-340.

Shortfall in determined member components of character relating to assessable income

Under section 276-405 of the ITAA 1997, the trustee of a CCIV sub-fund trust is liable to pay tax on the shortfall between a determined member component of an assessable income character and the member component of that character.

The determined member component is the amount the CCIV sub-fund trust advised its member in the member statement (AMMA statement). The member's member component is the amount attributed to the member fairly and reasonably in accordance with the constituent documents of the CCIV sub-fund trust and without regard to the member's tax characteristics.

Write at this item the total of any amounts you are liable to pay tax on under section 276-405.

Excess in determined member components of character relating to tax offset

Under section 276-410 of the ITAA 1997, the trustee of a CCIV sub-fund trust is liable to pay tax on any excess of a determined member component of a tax offset character over the member component of that character.

Write at this item the total of any amounts you are liable to pay tax on under section 276-410.

Trust components that are not reflected in determined member components

Under section 276-415 of the ITAA 1997 the trustee of a CCIV sub-fund trust is liable to pay tax on the shortfall between total determined member components of a particular assessable income, exempt income or non-assessable non-exempt income character and the determined trust component of that character. Broadly, the shortfall represents income amounts of the CCIV sub-fund trust that have not been effectively attributed to members.

Where the shortfall relates to the character of a discount capital gain, you must double the shortfall amount and include it at this item. This represents the amount that would otherwise have been recognised by members under section 276-85.

The shortfall is reduced by the amount of any rounding adjustment deficit and any amount that is reflected in a shortfall in determined member component of character relating to assessable income. The first reduction is to ensure that trustees are not taxed on relatively small amounts that inevitably arise from rounding variances between trust components and total member components. The second reduction is to prevent double tax of amounts already assessable to the trustee under section 276-405.

Write at this item the total of any amounts you are liable to pay tax on under section 276-415.

Other trustee liabilities

The trustee of a CCIV sub-fund trust is also liable to pay tax in the following situations:

  • under section 276-105 on amounts of each foreign resident member's determined member components, where the AMIT is not a withholding MIT (see Statement of attribution for non-withholding MITs)
  • pursuant to section 276-420 on under amounts of a character relating to assessable income not properly carried forward
  • pursuant to section 276-425 on over amounts of a character relating to tax offset not properly carried forward.

In relation to any trustee liability pursuant to sections 276-420 or 276-425, these assessments are typically initiated by the Commissioner when there is disagreement with the trustee concerning the amount of the income under-recognised or offset over-recognised in an income year. See, Law companion ruling LCR 2015/9 Attribution Managed Investment Trusts: trustee shortfall taxation – section 276-420.

In some situations, trustees may initiate an assessment under these provisions. If this applies to you, you must notify us in writing under section 275-605 on amounts of non-arm’s length income of a MIT that you have identified. The Commissioner will then make a determination of non-arms' length income and initiate assessments as appropriate. See LCR 2015/15 Managed Investment Trusts: the non-arm's length income rule in sections 275-605, 275-610 and 275-615 of the Income Tax Assessment Act 1997.

If the trustee is liable to pay tax under sections 276-420 or 276-425, the Commissioner may fully or partially remit the tax, under section 276-430, if satisfied that there is no detriment to the revenue.

For example, remission of tax may be considered to the extent that a shortfall of an income character or an over of a non-refundable tax-offset character would have been attributed to tax-exempt entities.

Submit any requests for the exercise of the Commissioner's discretion to remit income tax under section 276-430 through the Online services for business Secure mail and include the reasons for your request. Alternatively, your registered tax agent can send a request through Online services for agents Client communication.

Continue to: Additional information

Return to: Instructions to complete the attribution CCIV sub-fund tax return 2024

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