The trust is a major form of vehicle used for holding investment assets, carrying on business, transferring family wealth to future generations and for income splitting. Furthermore, most superannuation funds are, in fact, trusts. The trust is not a distinct legal entity and is not taxed as a separate entity. The primary rule is that the beneficiary under a trust is subject to tax. Only where the beneficiary is not subject to tax will the trustee be assessed to pay tax.

This course is mainly concerned with establishing when the primary rule applies, and when it is displaced by the exceptional rules. An understanding of the specific tax treatment of trusts is important to any student setting out to acquire, or refine, an understanding of the Australian tax system.

As in many other areas of taxation, the analysis of the tax treatment of trusts necessarily involves a consideration of capital gains tax issues. You may, accordingly, benefit from undertaking the course 0311/0411/0511/0611 Taxation of Capital Gains prior to, or concurrently with, this course.

This course aims to develop and promote a knowledge of the principles and policy considerations which have particular application to the taxation of trusts, focusing mainly on discretionary trusts. It aims to develop a critical approach to the manner in which trusts are taxed and the implications of this for investors and the tax system. It instils a knowledge of the cases on the taxation of trusts and an understanding of the reasons for the various integrity measures affecting trusts.

Textbook lists for ATAX courses will be available from the UNSW Bookshop from 1 February for Semester 1 courses and from 1 July for Semester 2 courses.