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Trust Dividend

In: Trust
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Q: The family trust holds shares in company A and at the end of the year, received $80,000 from company A as a dividend to the trust unfranked. The trustee is a company, can the whole family trust income less any expenses go to one beneficiary who is the director of the trustee and company A?

 

A: Yes, there is nothing to prevent the payment of such a dividend. Companies are separate legal entities from their individual directors (ITAA 1997 s 960-100, 995-1(1); Salomon v Salomon & Co (1897) AC 22; Interpretative Decisions ID 2002/823 and ID 2003/738).

Tags: Trust

Written by Panbo Ye

I help people discover POWERFUL unknowns in Tax Ideas | Wealth Strategies | Retirement Planning | Finance Solutions!

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