Private ruling: Capital gains tax - trust resettlement – CGT events E1, E2 and A1
Date of advice: 15 February 2019
Published: May 2019
Ruling period: Financial year ending 30 June 2019
Date scheme commenced: 1 July 2018

Ruling: Q1: Will the proposed variations to your Unit Trust Deed (Deed) cause CGT event A1, E1 or E2 to happen? | A1: No. The variation to the Deed is a valid exercise of the Trustees powers and the change will not cause the existing trust to terminate; nor will it lead to a particular asset being settled on terms of a different trust. In addition, the variation will not result in a change of ownership of any of the trust assets. As such, the proposed variation to the Deed will not cause CGT events A1, E1 or E2 to happen.

Relevant facts and circumstances: The Unit Trust (the Trust) was established a number of years ago. The unit holders are: ● Company A as trustee for a fund and ● Company B as trustee for a fund The trustee is a company incorporated in Australia. The trustee and the unit holders intend to execute a Deed of Amendment to vary the terms of the Deed prior to the end of the financial year. The variation is allowed by the terms of the trust deed.

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