taxable income, page-4

Coppertop,

If I understand your question properly then there are two issues, firstly the tax treatment on the distribution and secondly the tax treatment of any assessable income generated by the fund for the same period over and above the distribution. Ie assessable profit say 11 cents, distribution 5 cents, what is the tax treatment of the balance of 6 cents. If I misunderstood your question please let me know.

pre-Bamford trusts distributed all income so it was assessable in the hands of unitholders. Bamford changed that and allows "reasonable discretion" to a trustee to retain a portion of income. To give you an idea one of the tests of "reasonable" is unitholder distribution expectations, that is a trustee cannot be unreasonable in what it retains.

Its getting a bit late for me now so tomorrow I will double check the legislation and tax consequences of Bamford and post tomorrow evening.

Good luck to holders