Trust payments to beneficiaries

Discussion in 'Accounting & Tax' started by RoyG, 21st Mar, 2015.

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  1. RoyG

    RoyG New Member

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    1st Jul, 2015
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    Perth WA
    Hi

    If a discretionary trust was formed with the beneficiaries being my wife and myself.
    If my wife gave by deed of gift money from her personal account to the trust and I then borrowed the money from the trust on commercial terms and interest rate under proper loan agreement and by mortgage secured over property. The trust then distributes the income to my wife as taxable income. Would the ATO allow this/ have a problem with this ?

    RoyG
     
    RoyG, 21st Mar, 2015
    #1
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    There is a private ruling which allows one spouse to borrow from another, so this is a similar arrangement which may pass. However if it was your money origianally then maybe Part IVA could be applied to deny.
     
    Terry_w, 22nd Mar, 2015
    #2
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