Private ruling: Trusts - income - section 99A
Date of advice: 22 January 2021
Published: March 2021
Ruling period: Year ending 30 June 2021
Date scheme commenced: 1 July 2020

Ruling: Q1: Will the Commissioner exercise discretion under section 99A of the Income Tax Assessment Act 1936 (ITAA 1936) to tax the net income of the trust estate to which no beneficiary is presently entitled under section 99 of the ITAA 1936? | A1: Yes. After consideration of the relevant factors, the Commissioner is of the opinion that it would be unreasonable that section 99A of the ITAA 1936 should apply in relation to the testamentary trust. Accordingly, section 99 of the ITAA 1936 will apply.

Relevant facts and circumstances: The Testamentary Trust (the trust) was created by the will of the deceased who died on XX April 20XX. The trust was established for the benefit of one of the deceased's family members. The trust's only assets were distributed from the deceased's estate under the will and there has been no injection or contribution of additional assets to the trust. The trust is an Australian resident for tax purposes. There is no beneficiary presently entitled to the income of the trust.

Relevant legislative provisions: Income Tax Assessment Act 1936 section 99 | Income Tax Assessment Act 1936 section 99A