Trust election status, trust type, details and tax payable

When you must complete the election status

This item must be completed if the trustee:

• has made or is making a family trust election
• is revoking or varying an existing family trust election
• has made or is making an interposed entity election
• is revoking an existing interposed entity election.

If the trustee makes a family trust election or an interposed entity election, you may have to pay family trust distribution tax if you distribute to an entity outside of the family group of the individual specified in the family trust election.

Family trust election status

If the trustee of the trust has not made or is not making a family trust election, don't complete this item.

Making or has previously made a family trust election

If the trustee is making a family trust election specifying the 2004–05 or later income year, write the appropriate income year in the 4–digit box at this item and complete a Family trust election, revocation or variation 2024 specifying the 2004–05 or later income year.

If the trustee has previously made a family trust election specifying an income year before 2023–24, write the appropriate income year in the 4–digit box at this item (for example, for the 2022–23 income year write 2023).

If the trustee has previously made a family trust election specifying an income year before 2004–05 and took advantage of the one-off opportunity in Practice statement law administration PS LA 2004/1 (GA) (Withdrawn) Lodgment opportunity for family trust and interposed entity elections to specify an earlier year, write the earlier income year specified in the 4–digit box at this item.

A trustee of the trust can't make a family trust election specifying a year earlier than 2004–05 in the Trust tax return 2024 (section 272-80 of Schedule 2F to the Income Tax Assessment Act 1936 (ITAA 1936)).

Varying the test individual of a family trust election

Print V in the single box if the specified individual of a family trust election is being varied from a time in 2023–24. You must complete and lodge a Family trust election, revocation or variation 2024 with the Trust tax return 2024.

If the relevant conditions in section 272-80 of Schedule 2F to the ITAA 1936 are satisfied, the trust may vary an election, so a different individual is specified as the individual whose family group is taken into account in relation to the election.

The trust may only vary the specified individual of a family trust election once, except where doing so under subsection 272-80(5C) of Schedule 2F to the ITAA 1936 in relation to a relevant order, agreement or award mentioned in paragraphs 126-5(1)(a) to (f) of the Income Tax Assessment Act 1997 (ITAA 1997).

Revoking a family trust election

Print R in the single box if the family trust election made by the trust is being revoked in 2023–24. You must complete and lodge a Family trust election, revocation or variation 2024 with the Trust tax return 2024.

A family trust election can only be revoked by a trust that satisfies the relevant conditions in section 272-80 of Schedule 2F to the ITAA 1936.

Interposed entity election status

If the trustee of the trust has not made or is not making an interposed entity election, don't complete this item.

Making or has previously made an interposed entity election

If the trustee is making one or more interposed entity elections this year specifying a day in the 2004–05 or later income year, write the earliest income year specified in the box at this item. Also complete an Interposed entity election or revocation 2024 for each election specifying a day in the 2004–05 or later income years.

If the trustee has previously made one or more interposed entity elections specifying a day in an income year before 2023–24, write the earliest income year specified in the box at this item.

A trustee of the trust can't make an interposed entity election specifying a year earlier than 2004–05 in the Trust tax return 2024 (section 272-85 of Schedule 2F to the ITAA 1936).

Revoking an interposed entity election

Print R in the single box if an interposed entity election made by the trust is being revoked from 2023–24. You must complete and lodge an Interposed entity election or revocation 2024 with the Trust tax return 2024.

An interposed entity election can only be revoked by a trust that satisfies all the relevant conditions in section 272-85 of Schedule 2F to the ITAA 1936.

Family trust distribution tax

A consequence of a trust making a family trust election or an interposed entity election is that under section 271-15 or section 271-20 of Schedule 2F to the ITAA 1936 a special tax, family trust distribution tax (FTDT), may be payable. FTDT is payable at 47% by the trustee on any conferral of present entitlement to, or distribution of, income or capital of the trust to persons who are not members of the family group of the specified individual within the meaning of section 272-90 of Schedule 2F to the ITAA 1936.

For this purpose a distribution of income or capital by a trust has the meaning given in sections 272-45 and 272-60 of Schedule 2F to the ITAA 1936.

The definition of family group includes a former spouse, a former widow or widower, and a former stepchild.

If FTDT is payable by you, complete the Family trust distribution tax payment advice and post it with your FTDT payment to us at the address on the FTDT payment advice. Make cheques or money orders payable to the Deputy Commissioner of Taxation and print ‘Not negotiable’ across the cheque. Tender all cheques in Australian currency. Don't send cash by post.

Interaction between family trust distribution tax and TFN withholding for closely held trust rules

If you are the trustee of a trust that has made a family trust election or an interposed entity election and make a payment or distribution to a beneficiary that is not subject to FTDT, you need to consider the TFN withholding for closely held trusts.

For more information, see Appendix 11.

Type of trust

Print in the first box the code from Table 1 that best describes the type of trust for who you are lodging the trust tax return.

Descriptions of the types of trust are at Table 2.

Print X in the second box at Type of trust if the trust is also a charity.

CCIV sub-fund trusts

You must answer this question if you used code V at Type of trust.

Print X in the Yes box if the corporate collective investment vehicle (CCIV) sub-fund trust owns shares that are referable to a CCIV sub-fund trust of the same CCIV as the CCIV sub-fund trust.

Otherwise, print X in the No box.

A CCIV, may have more than one CCIV sub-fund trust.

Managed investment trusts

Complete the following 3 questions:

• Is the trust a managed investment trust (MIT)?
• MIT type
• If the trust is a managed investment trust, has the trustee made an election into capital account treatment?

Is the trust a managed investment trust (MIT)?

You must answer this question if you used codes F, M, U, P or Q at Type of trust.

Print X in the Yes box at this item if the trust is a managed investment trust.

Otherwise, print X in the No box.

A MIT is broadly a publicly-held and commercially-operated collective investment trust that invests in primarily passive income activities. A trust qualifies as a MIT if all of the following apply for the income year it operates:

• the trustee is an Australian resident, or the central management and control of the trust is in Australia
• the trust does not carry on or control an active trading business
• the trust is a managed investment scheme
• the trust meets the widely held requirement
• the trust meets the closely held restriction
• the trust is operated or managed by an appropriately regulated entity.

MIT type

If you answered Yes at Is the trust a managed investment trust (MIT)?, you must choose a MIT type from the table below and print the code at MIT type.

If the trust is a managed investment trust, has the trustee made an election into capital account treatment?

You must answer this question if you answered Yes at Is the trust a managed investment trust (MIT)?

If the trust is:

• not a managed investment trust, leave this question blank
• a managed investment trust and the trustee has never made an election, print X in the No box
• a managed investment trust and the trustee has made an election, print X in the Yes box

MIT capital treatment rules

The MIT capital treatment rules allow the trustee of an eligible MIT to irrevocably choose to apply the capital gains tax provisions for the taxation of gains and losses on disposal of eligible assets, rather than on revenue account. For the purposes of the MIT capital treatment rules, a disposal also includes ceasing to own, or otherwise realising, the asset.

You must make the election for the first year the trust qualifies as a MIT. The election is irrevocable as long as the MIT remains eligible. If a MIT doesn't make a capital account treatment election in the first year, it will be taxed on revenue account under general tax law principles.

Who is eligible to make an election?

The trustee of a MIT may make a capital treatment election. The election must be made in the approved form.

Is any tax payable by the trustee?

Print X in the Yes box at this item if the trustee is liable to pay any tax, even if payments have been made in advance. Otherwise, print X in the No box.

The trustee is generally liable to pay tax on:

• that part of the net income of the trust that has not been assessed to either a presently entitled beneficiary or the trustee on behalf of a presently entitled beneficiary; see Is a beneficiary presently entitled to a share of the income of the trust estate?
• shares of the net income of a trust in respect of beneficiaries, whether or not the beneficiaries are acting in their capacity as trustee of another trust estate, who are presently entitled to a share of the income of the trust estate but are non-resident at the end of the income year; see Non-resident beneficiary additional information
• shares of the net income of a trust in respect of beneficiaries who are presently entitled to a share of the income of the trust estate but are under a legal disability; see Appendix 10
• if the trust is a special disability trust and the principal beneficiary is an Australian resident at the end of the income year, the whole of the net income of the trust
• if an election has been made for the trustee to be assessed on a capital gain of the trust, the amount of the capital gain.

The rate of tax payable by the trustee will depend on the type of trust and the beneficiary's individual circumstances.

If the beneficiary is presently entitled to a share of the income of the trust estate, not under a legal disability, and is a resident at the end of the income year, then the beneficiary, not the trustee, is generally taxed on that same percentage share of the net income of the trust. This amount may be different if any beneficiary or the trustee has been made specifically entitled to an amount of franked distribution or capital gains (that is, the capital gain or franked distribution has been streamed to a particular beneficiary).

Net income means the total assessable income calculated as if the trustee was a resident taxpayer, less all allowable deductions, except deductions for net farm management deposits. For more information, see Appendix 10. In the case of any beneficiary with no beneficial interest in the trust corpus, past losses are required to be met out of corpus.

Request for a non-taxable advice

If the trustee is not assessed on income and a non-taxable advice is required, provide a request on a separate sheet of paper headed ‘Request for a non-taxable advice’ and include the trust name and TFN with the details.

Sign the request, attach it to the tax return and print X in the Yes box at Have you attached any ‘other attachments’? at the top of the tax return.

Final tax return

Print X in appropriate box.

If the trustee does not expect to lodge further tax returns, provide a statement on a separate sheet of paper headed ‘Final trust tax return’ showing:

• the reason the trust will not need to lodge further tax returns
• the manner of disposal of any assets of the trust if not disclosed elsewhere in the tax return.

Attach the statement to the tax return and print X in the Yes box at Have you attached any ‘other attachments’? at the top of the tax return.

If the trust is a subsidiary member of a consolidated group or MEC group, print X in the No box at Final tax return if membership of the group is the only reason the trust will not be required to lodge future returns.

Electronic funds transfer (EFT)

We need your financial institution details to pay any refund owing to you, even if you have provided them before, including:

• Bank State Branch (BSB) number – 6 digits, don't include spaces or hyphens
• account number – no more than 9 digits, don't include spaces or hyphens
• account name – for example Citizen Pty Ltd. Don't show account type, such as cheque in the account name. Include spaces between each word and initials where required. If it exceeds 32 characters, provide the first 32 characters only.

Your refund can only be paid into a recognised financial institution account located in Australia.

Direct debit

The trustee can pay tax owing directly from their account using EFT. A trustee can provide separate account details for direct debit and direct refund.

Trustees can arrange direct debit by using a tax agent who can lodge tax returns through the practitioner lodgment service (PLS), or by completing a Direct debit request form. Allow at least 5 working days for processing of the direct debit request form. Tax agents can transmit payment details up to 3 working days before the due date once the direct debit request has been processed.

If the trustee used direct debit last year and the account details provided are correct, you don't need to make another request. The notice of assessment will display a message that the tax debt will be debited from the nominated account on the due date.

If the account details have changed, complete a direct debit request if you want to use direct debit this year.

A direct debit request remains in force until it is cancelled. Cancellations must be received 3 working days before the payment date.

There is no provision for a direct debit election in the tax return. The direct debit request is also available as part of PLS software packages.

Continue to: Business description and status – items 1 to 2

Return to: Instructions to complete the Trust tax return 2024