Private ruling: Trust residency
Published: September 2017
Ruling period: Year ended 30 June 2015 | Year ended 30 June 2016 | Year ending 30 June 2017 | Year ending 30 June 2018 | Year ending 30 June 2019 | Year ending 30 June 2020
Date scheme commenced: 1 July 2014

Ruling: Questions and answers | 1. Is the Trust a resident of Australia for taxation purposes? | Yes. | 2. Did the Trust become a resident of Australia for taxation purposes in the 2014 income year? | Yes. | 3. Is the Trust required to have a tax file number and lodge tax returns in Australia? | Yes.

Relevant facts and circumstances: The trust was formed in the 20XX income year. The trust holds property. The trust has a number of Trustees who are residents of Australia for taxation purposes. The trustees make decisions on behalf of the trust in Australia. The central management and control of the trust is in Australia.

Relevant legislative provisions: Income Tax Assessment Act 1936 subsection 95(2)

Reasons for decision: Summary: Division 6 of the Income Tax Assessment Act 1936 (ITAA 1936) distinguishes between a 'resident trust estate' and a 'non-resident trust estate'. Subsection 95(2) of the ITAA 1936 provides that a trust estate shall be taken to be a resident trust estate in relation to a year of income if: a) A trustee of the trust estate was a resident at any time during the year of income; or b) The central management and control of the trust estate was in Australia at any time during the year of income. | Detailed Reasoning - Application to your circumstances: In the 20XX income year the trustee of the trust became a resident of Australia for taxation purposes. The majority of the Trust decisions are made in Australia; therefore, the Trust qualifies as a resident of Australia under subsection 95(2) of the ITAA 1936. The date the Trust became a resident of Australia will be the date the trustee became a resident of Australia for taxation purposes. Accordingly, the Trust is required to have its own: ● Tax file number, which the trustee uses in lodging income tax returns for the trust, and ● A trustee is required to lodge a trust income tax return, regardless of the amount of income involved, unless exempted by the Commissioner.