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Trusts offered tax exemption to avoid restructure costs
Draft rules would let 350,000 small businesses avoid costly trust restructures and state stamp duties as consultation opens.
- On Thursday, Treasurer Jim Chalmers unveiled draft legislation allowing businesses using discretionary trusts to avoid restructuring costs and state stamp duties by electing to make fixed distributions to pre-nominated beneficiaries.
- Small businesses faced an "impossible choice between a higher tax burden or a costly restructure" ahead of the new 30 per cent minimum tax on discretionary trusts starting July 1, 2028.
- Treasury estimates 350,000 small businesses operate through discretionary trusts, with 140,000 not expected to pay additional tax, while the government projects the measure could raise $4.5 billion by 2030.
- The Australian Chamber of Commerce and Industry warned the tax remains "significantly higher" for small businesses, despite Chalmers claiming the reform package supports investment with over $3.8 billion in measures.
- Consultation on the draft bills remains open until September 18, though Chartered Accountants ANZ leader Susan Franks warned the short timeframe is challenging for such complex reforms.
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Sydney Morning Herald+3 Reposted by 3 other sources
Small business trusts get stamp duty escape hatch in Chalmers’ latest tax tweak
This is the third round of changes to the budget tax reforms, following alterations to ensure widows were not left with large capital gains tax bills or denied negative gearing incentives.
·North Sydney, Australia
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Coverage Details
Total News Sources16
Leaning Left6Leaning Right2Center3Last UpdatedBias Distribution55% Left
Bias Distribution
- 55% of the sources lean Left
55% Left
L 55%
C 27%
R 18%
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