Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) The purpose of this section is to allow a trustee of a resident trust to make a choice that has the effect that the trustee will be assessed on a * capital gain of the trust if no trust property representing the capital gain has been paid to or applied for the benefit of a beneficiary of the trust.
Trusts for which choice can be made
(2) A trustee can only make a choice under this section in relation to a trust estate that is, in the income year in respect of which the choice is made, a resident trust estate (within the meaning of Division 6 of Part III of the Income Tax Assessment Act 1936 ).
Circumstances in which choice can be made
(a) a * capital gain is taken into account in working out the * net capital gain of a trust for an income year; and
(b) trust property representing all or part of that capital gain has not been paid to or applied for the benefit of a beneficiary of the trust by the end of 2 months after the end of the income year;
the trustee may, no later than the deadline in subsection (5), make a choice that subsection (4) applies in respect of the capital gain.
Consequences if trustee makes choice
(4) These are the consequences if the trustee makes a choice that this subsection applies in respect of a * capital gain:
(a) sections 115 - 215 and 115 - 220 do not apply in relation to the capital gain;
(b) for the purposes of this Act, the trustee is taken to be * specifically entitled to all of the capital gain.
(5) The deadline for the purposes of subsection (3) is:
(a) the day 2 months after the last day of the income year; or
(b) a later day allowed by the Commissioner.
Note: This deadline is an exception to the general rule about choices
in section 103 - 25.