Document ID: chunk:federal_register_of_legislation:F2022C00244:reg:21:p2
Version: federal_register_of_legislation:F2022C00244
Segment Type: reg
Provision Reference: reg 21 (pt 2/2)
Character Range: 32474–33890

assets.
Penalty: 30 penalty units.
 (9) However, subsection (8) does not prevent a licensed trustee company (within the meaning of the Corporations Act 2001) or the public trustee of a State or Territory from operating common funds for investment purposes.
 (10) The trustee of a *private ancillary fund must ensure that the fund does not acquire an asset (except by way of gift) if the asset is a *collectable (or would be a collectable but for the asset not being used or kept mainly for an entity's personal use or enjoyment). If the fund acquires such an asset by way of gift, it must sell or distribute the asset within 12 months after acquiring it.
Penalty: 30 penalty units.
 (11) The trustee of a *private ancillary fund must ensure the fund does not *carry on a *business.
Penalty: An amount equal to 25 per cent of the net profit (if any) of the business for each *financial year during all or part of which the contravention continues.
 (12) However, a trustee does not contravene subsection (11) merely because the fund's passive investment activities, because of repetition, volume and regularity, mean that it is *carrying on a *business.
Note: This subsection has the effect that the mere holding of, or dealing in, investments, such as shares or rental properties, for the purpose of deriving income that can be distributed to eligible deductible gift recipients, does not contravene subsection (11).