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An analysis from Corrs Chambers Westgarth, Taxand Australia
The Australian Government has proposed a 30% minimum tax on discretionary trusts from 1 July 2028, with Treasury now consulting on how the measure should be implemented. A key issue is determining which trusts will fall within the new regime.
The consultation proposes defining discretionary trusts by reference to whether a trust qualifies as a “fixed trust” under existing tax law. Corrs warns that this approach could result in many commercial trusts being treated as discretionary trusts, potentially capturing structures used in property, infrastructure and other investment arrangements that are not designed for income splitting.
Simon Mifsud, Simon Clark and Tom d’Arbon from our Australian member firm, Corrs Chambers Westgarth, examine the definitional challenges and why appropriate exclusions will be important to prevent the proposed minimum tax applying more broadly than intended, which you can read here.
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Australia | Compliance | Financial Services | Income Tax | investment structuring | Tax Policy