ATO Contacting Taxpayers about Unit Trust Arrangements
The ATO is currently contacting taxpayers via SMS with concerns regarding unit trust arrangements. The ATO announced it has identified cases where a private group seeks to extinguish unpaid present entitlements (UPEs) or avoid obligations under Division 7A by implementing an arrangement where a private company subscribes for units in a unit trust. The unit trust may then provide payments or loans to other entities within the same group.
The ATO says it is concerned that such arrangements may give rise to a number of income tax consequences under Division 7A, s100A ITAA 1936 or the Part IVA anti-avoidance provisions.
Should any taxpayer receive an SMS or other enquiry from the ATO they should immediately contact our office.
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