Key Points about Trust Resolutions
Timing Requirements:
- Trust income must be distributed by 30 June (or earlier as per trust deed) to avoid trustee assessment or default beneficiary clause.
- Written records are crucial, especially for streaming capital gains or franked dividends.
Documenting Trust Resolutions:
- Trust deed determines if verbal resolutions are allowed.
- Verbal resolutions can be acceptable but should be documented promptly.
- Corporate trustees must prepare a minute within one month of the meeting.
Best Practices:
- Prepare, sign, and date resolutions by 30 June to avoid disputes with the ATO.
- Promptly produce resolutions if relevant to legal proceedings to avoid exclusion from objections.
Lesson from Dalby's Case:
- Failure to produce or raise the resolution promptly can lead to exclusion from objections.
Tax Tip: It's best to document trust resolutions promptly to avoid disputes and legal complications, especially if they're relevant to tax assessments.
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