Trustee Resolutions – an ATO Requirement
By 30 June 2017, Trustees (or directors of a trustee company) need to decide on how the trust will distribute its taxable income for this year. This is an ATO requirement.
This does NOT mean that you need to know what your taxable income will be at this point, although it is certainly more helpful to have an approximate idea when deciding where income will be allocated.
If no beneficiary is determined to be entitled to the income at 30 June, then the trustee can be assessed on the trust’s taxable income (at a whopping 47%!!).
Decisions made by the trustees should be documented in writing (called ‘Trustee Resolution’) by 30 June 2017.
This resolution is an absolute necessity for any type of active trading or investment trust. If you have a trust with our firm, a 2017 Resolution will be prepared for you shortly. Your accountant will be in touch with you over the next few weeks.