Income Tax Assessment Act 1936

SCHEDULE 2F - TRUST LOSSES AND OTHER DEDUCTIONS  

Division 271 - Family trust distribution tax  

SECTION 271-40   EXCLUSION OF DIRECTORS FROM LIABILITY TO PAY TAX  

271-40(1)    
This section applies to a director of a company who is included among persons who are jointly and severally liable to pay family trust distribution tax under section 271-15 , 271-20 , 271-25 or 271-30 .

Director not taking part in distribution decision

271-40(2)    
If:

(a) the director did not take part in any decision to confer the entitlement or make the distribution concerned; and

(b) if the director was aware of the proposal to make the decision or of the fact that it was made - the director took reasonable steps to prevent the making, or the implementation, of the decision;

the director is not included among the persons jointly and severally liable.

Director taking part in distribution decision

271-40(3)    
If:

(a) the director took part in any decision to confer the entitlement or make the distribution; and

(b) the director voted against, or otherwise disagreed with the decision; and

(c) the director took reasonable steps to prevent the implementation of the decision;

the director is not included among the persons jointly and severally liable.