Private ruling: Trust resettlement
Date of advice: 2 September 2021
Published: December 2021
Ruling period: Year ending 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the proposed amendments to the Trust Deed cause capital gains tax (CGT) event E1 or E2 in section 104-55 or section 104-60 of the Income Tax Assessment Act 1997 to occur? | A1: No, the proposed amendment to the Trust Deed will not cause the Trust to terminate or give rise to a particular asset of the Trust. The proposed amendments are considered within the powers of the Trustee as contained in the Trust Deed and therefore, will not cause CGT event E1 or E2 in section 104-55 or section 104-60 of the Income Tax Assessment Act 1997 to happen.

Relevant facts and circumstances: • The Trust was established by Trust Deed on XX XXX 19XX. • The specified beneficiaries of the Trust are the children of Person A, who has X children. • The general beneficiaries of the Trust are Person A and their spouse, parents & siblings. • The trust owns receivables, cash and shares that were all purchased post 20 September 1985. • The proposed Deed of Variation will be made in accordance with the Trust Deed which provides powers for the Trustee to make changes to the Trust Deed. • The proposed variation is to amend the Trust Deed to exclude beneficiaries from the Trust being Person B or any spouse or lineal descent of Person B. • General beneficiary of the Trust Person C died in 20XX. • There have been deeds of variation made to the trust deed previously on XX XXX 20XX and XX XXX 20XX in relation to the definition of net income and how the trust deals with the net income. • The Trust Deed has not been amended yet with the proposed changes to exclude Person B as a beneficiary.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-55 | Income Tax Assessment Act 1997 section 104-60 | Income Tax Assessment Act 1997 section 149-10 | Income Tax Assessment Act 1997 Section 149-15 | Income Tax Assessment Act 1997 Section 149-30