The Family Trust Election (FTE) laws have been in force since the first instalment was introduced into parliament in 1998 - and that legislation was back dated to 1995! Subsequent legislation has extended the FTE law. However despite the time these laws have been in force there is still uncertainty about the multiple effects of FTE. These include:
- the trust loss legislation governing the ability of trusts to deduct prior years losses, current year deductions and bad debts (Schedule 2F, ITAA 1936)
- legislation imposing a minimum at risk holding period for shares enabling imputation credits to be used (Division 1A of Part IIIA, ITAA 1936)
- the legislation governing the deduction of company losses and debts where companies are owned by family trusts (Division 165, ITAA 1997)
- the making of distributions outside a family group by a family trust which are subject to the family trust distribution tax.
- the trust loss legislation governing the ability of trusts to deduct prior years losses, current year deductions and bad debts (Schedule 2F, ITAA 1936)
- legislation imposing a minimum at risk holding period for shares enabling imputation credits to be used (Division 1A of Part IIIA, ITAA 1936)
- the legislation governing the deduction of company losses and debts where companies are owned by family trusts (Division 165, ITAA 1997)
- the making of distributions outside a family group by a family trust which are subject to the family trust distribution tax.
This seminar analysed the FTE tax laws.