Private ruling: Commissioner discretion - tax exempt
Date of advice: 23 January 2026
Published: 16 March 2026
Ruling period: 1 July 20XX. | 1 July 20XX.
Date scheme commenced: DD MM 20XX

Ruling: Q1: Will the Commissioner exercise the discretion in subsection 100AA(4) of the Income Tax Assessment Act 1936 (ITAA 1936) to disregard the failure of the Trustee to notify the tax exempt beneficiary of their present entitlement to a share of the trust fund at the end of two months after the end of the relevant income year as required in paragraph 100AA(1)(c) of the ITAA 1936? | A1: Yes. Having considered your circumstances, the Commissioner will exercise the discretion in subsection 100AA(4) of the ITAA 1936 to disregard the failure of the Trustee to notify the tax-exempt entity of its present entitlement.

Relevant facts and circumstances: The Deceased died on DD MM 20XX. Probate was granted on DD MM 20XX. The Trustee of The Deceased Estate is the Deceased's relative. The Deceased died leaving their estate solely to an income tax exempt entity for the purposes of section 100AA of the ITAA 1936 (the exempt entity). The Trustee of the Deceased Estate failed to satisfy the two-month requirement regarding notifying in writing the exempt entity of the present entitlement. The failure to satisfy the two-month requirement was due to an oversight by the Trustee. The Trustee was not made aware of their requirement to do so until DD MM 20XX when they received advice from the Estate's lawyers. There were also delays in administration of the Estate, due to real estate owned across states within Australia. Administration of the Estate was finalised on DD MM 20XX. On DD MM 2025, The Estate's lawyers notified the exempt entity that an interim distribution of $X was proposed by the Trustee. On DD MM 20XX, this payment was made to the exempt entity. The Trust tax returns for 20XX and 20XX income years were lodged in MM 20XX. The Commissioner has not previously applied this discretion to the Trustee.

Relevant legislative provisions: Income Tax Assessment Act 1936 subsection 100AA(1) | Income Tax Assessment Act 1936 subsection 100AA(2) | Income Tax Assessment Act 1936 subsection 100AA(3) | Income Tax Assessment Act 1936 subsection 100AA(4) | Income Tax Assessment Act 1936 subsection 100AA(5)