The High Court’s decision in Commissioner of Taxation v Bendel [2026] HCA 18 (“Bendel”) is a landmark development for the taxation of trusts and private groups. It brings to an end almost two decades of debate around the ATO’s view on the treatment of unpaid present entitlements (“UPEs”) in the context of Division 7A. In […]
Key points The minimum tax is built on the false assumption that affected trusts can restructure; for many property businesses, stamp duty makes this commercially impossible. The ATO’s existing guidance on trust corporatisation actively conflicts with the Government’s proposed solution, leaving legitimate businesses with no workable pathway. Effective reform requires genuine coordination between Treasury and […]
The Treasurer’s 2026–27 Federal Budget delivers a significant overhaul of Australia’s tax system, fundamentally reshaping how middle market businesses invest, structure and grow. While the measures will be phased in over the coming years, the scale and complexity of the changes mean businesses and investors face a critical period of assessment and potentially, change in response […]
Summary of key dates for tax reform announced in the Federal Budget 2026-27. Taxation of discretionary trusts Measure Effective date Explanation Minimum 30% tax on discretionary trust distributions 1 July 2028 30% tax liability payable by the trustee on all discretionary trust distributions. Beneficiaries (other than corporate beneficiaries) receive a non-refundable tax credit. Capital Gains […]
From 1 July 2028, trustees will pay a minimum tax of 30% on the taxable income of discretionary trusts that is distributed to beneficiaries. This tax will operate as a minimum tax at the trustee level. Beneficiaries, other than corporate beneficiaries, will receive non-refundable credits for the tax payable by the trustee. At a high […]
Pre-CGT assets The Government has announced a significant change to the capital gains tax (CGT) treatment of assets acquired on or before 19 September 1985. From 1 July 2027, these assets will no longer be fully exempt from CGT. Instead, capital gains arising after that date will become taxable, while gains accrued before 1 July […]
From 1 July 2027, the Government will limit the ability to negatively gear residential investment properties purchased from 7.30pm on 12 May 2026 other than new builds. Arrangements in relation to existing residential properties will be grandfathered. Negative gearing occurs where the income earned from property is less than the expenses incurred (for example, interest, […]
The Government has announced the $250 Working Australian Tax Offset (WATO) as a measure to reduce the tax burden on individual taxpayers in the face of cost-of-living pressures. On lodgement of their 2028 income tax returns, individuals who earn employment income and business income as sole traders will qualify for the $250 WATO. The WATO […]
While the headline Budget measures focused on CGT, negative gearing and trust reform, the business package offers a more targeted set of changes. The reintroduction of loss carry-back, a permanent $20,000 instant asset write-off, and expanded R&D and venture capital incentives provide some relief but fall short of the structural support many middle market businesses […]
The Government has announced changes to the electric car Fringe Benefit Tax (FBT) exemption, which has proven popular in encouraging Electric Vehicle (EV) adoption. The proposed changes retain strong incentives in the near term, but narrow and redesign the concession from 1 April 2029. From 1 April 2029, a permanent 25% discount on FBT will […]
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